CA Claims Investigation & Evaluation 2 — Questions and Answers
Question 1: An adjuster discovers that a claimant's recorded statement contradicts physical evidence at the loss scene. What is the best next step?
- Accept the recorded statement as authoritative
- Document the discrepancy and conduct further investigation (Correct answer)
- Deny the claim immediately based on inconsistency
- Request the claimant sign a non-disclosure agreement
Correct answer: Document the discrepancy and conduct further investigation
Contradictions between statements and physical evidence require documented further investigation to determine the true facts before any coverage decision.
Question 2: Which type of damages refers to losses that are not easily quantifiable, such as pain and suffering?
- Special damages
- General damages (Correct answer)
- Punitive damages
- Consequential damages
Correct answer: General damages
General damages compensate for non-economic losses like pain and suffering that have no fixed monetary value.
Question 3: When evaluating a bodily injury claim, which factor most directly affects the 'severity' component of damages?
- The claimant's occupation
- The nature and permanency of the injury (Correct answer)
- The policy limits of the insured
- The number of vehicles involved
Correct answer: The nature and permanency of the injury
Injury severity is primarily measured by the nature of the injury and whether it results in permanent impairment or disability.
Question 4: What does 'subrogation' allow an insurer to do after paying a claim?
- Cancel the insured's policy retroactively
- Pursue recovery from the responsible third party (Correct answer)
- Deny future claims from the same insured
- Assign the claim to another insurer
Correct answer: Pursue recovery from the responsible third party
Subrogation gives the insurer the legal right to step into the insured's shoes and recover paid claim amounts from the at-fault third party.
Question 5: A property adjuster uses the 'replacement cost value' (RCV) method. How does this differ from 'actual cash value' (ACV)?
- RCV subtracts depreciation; ACV does not
- ACV subtracts depreciation; RCV does not (Correct answer)
- RCV only covers structural damage; ACV covers contents
- ACV applies only to commercial policies
Correct answer: ACV subtracts depreciation; RCV does not
ACV equals replacement cost minus depreciation, while RCV pays the full cost to replace damaged property with new materials of like kind and quality.
Question 6: During a liability investigation, an adjuster obtains a police report. What is the primary evidentiary limitation of police reports?
- They are never admissible in any legal proceeding
- They represent one officer's observations and may contain hearsay (Correct answer)
- They automatically establish fault for insurance purposes
- They supersede all other forms of physical evidence
Correct answer: They represent one officer's observations and may contain hearsay
Police reports reflect the responding officer's observations and often include hearsay statements, so they must be corroborated with additional evidence.
Question 7: What is an 'independent medical examination' (IME) most commonly used to assess in a bodily injury claim?
- The claimant's income history
- The nature, extent, and causation of the claimed injuries (Correct answer)
- The insured's prior claims record
- Policy coverage gaps and exclusions
Correct answer: The nature, extent, and causation of the claimed injuries
An IME is requested by the insurer to obtain an objective physician's opinion on whether the injuries are consistent with the accident and what treatment is medically necessary.
CA Claims Investigation & Evaluation 2
An adjuster discovers that a claimant's recorded statement contradicts physical evidence at the loss scene.
What is the best next step?