ACE Claims Processing & Investigation 2 — Questions and Answers
Question 1: Under ACORD standards, which field in the ACORD 3 (Loss Notice) form captures the reported date of loss distinct from the discovery date?
- Loss Date (Correct answer)
- Reported Date
- Discovery Date
- Occurrence Date
Correct answer: Loss Date
The Loss Date field captures when the actual loss event occurred, which may differ from when it was discovered or reported.
Question 2: A subrogation right in property insurance means the insurer, after paying a claim, can:
- Cancel the insured's policy immediately
- Pursue recovery from the responsible third party (Correct answer)
- Require the insured to repay the claim amount
- Deny future claims on the same property
Correct answer: Pursue recovery from the responsible third party
Subrogation allows the insurer to step into the insured's shoes and seek reimbursement from the negligent third party who caused the loss.
Question 3: Which investigation technique is MOST appropriate when a claimant alleges permanent disability but surveillance footage shows physical activity inconsistent with the claim?
- Recorded statement only
- Independent Medical Examination (IME) (Correct answer)
- Examination Under Oath (EUO)
- Field inspection report
Correct answer: Independent Medical Examination (IME)
An IME uses an independent physician to objectively assess the claimant's actual physical condition against the alleged disability.
Question 4: In workers' compensation claims, the term 'compensable injury' means:
- Any injury occurring on company property
- An injury arising out of and in the course of employment (Correct answer)
- An injury requiring hospitalization
- An injury caused by employer negligence
Correct answer: An injury arising out of and in the course of employment
A compensable injury must meet the dual test of arising out of employment and occurring in the course of employment.
Question 5: The ACORD AL3 (Auto Loss Notice) form's 'Point of Impact' field primarily assists in:
- Calculating depreciation on the vehicle
- Determining which coverage applies
- Reconstructing the accident sequence and assigning fault (Correct answer)
- Establishing the vehicle's market value
Correct answer: Reconstructing the accident sequence and assigning fault
The point of impact information helps adjusters and accident reconstructionists determine how the collision occurred and who bears liability.
Question 6: A reservation of rights letter is sent by an insurer to:
- Confirm full coverage acceptance of a claim
- Notify the insured that coverage may be denied while the investigation continues (Correct answer)
- Demand reimbursement from a third party
- Request medical records from the claimant
Correct answer: Notify the insured that coverage may be denied while the investigation continues
A reservation of rights letter allows the insurer to defend or investigate a claim without waiving any coverage defenses.
Question 7: Under the principle of indemnity, an insured who suffers a $50,000 loss with a $10,000 deductible and $500,000 policy limit should receive:
- $500,000
- $50,000
- $40,000 (Correct answer)
- $10,000
Correct answer: $40,000
Indemnity restores the insured to pre-loss condition; the deductible is subtracted from the covered loss amount ($50,000 - $10,000 = $40,000).
ACE Claims Processing & Investigation 2
Under ACORD standards, which field in the ACORD 3 (Loss Notice) form captures the reported date of loss distinct from the discovery date?