Claims Handling Procedures & Ethics Flashcards
7 cards from real CALA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Claims Handling Procedures & Ethics flashcards as text
An insured submits a theft claim but the police report does not match the timeline provided in the sworn statement. What should the adjuster do first?
Answer: Request a recorded statement to clarify the discrepancy before making a coverage decision
Inconsistencies should be explored through additional investigation, including a recorded statement, before making a coverage determination.
What does the principle of 'utmost good faith' (uberrimae fidei) require of an adjuster during claims handling?
Answer: Honest, transparent, and fair dealing in all aspects of the claims process
Utmost good faith requires both parties—insurer and insured—to deal honestly and transparently without concealment or misrepresentation.
During a bodily injury claim, an adjuster receives a demand letter from the claimant's attorney that exceeds policy limits. What is the adjuster's priority obligation?
Answer: Notify the insured that the demand exceeds policy limits so they can seek personal counsel
When demands exceed policy limits, the adjuster must promptly notify the insured of potential personal exposure so they can retain independent counsel.
An adjuster is offered a gift by a contractor who frequently works on insured properties. The most ethical course of action is to:
Answer: Decline the gift to avoid any actual or perceived conflict of interest
Accepting gifts from contractors can create conflicts of interest that compromise objectivity; the ethical standard is to decline entirely.
A claimant speaks limited English and is having difficulty understanding settlement terms. What is the adjuster's ethical responsibility?
Answer: Arrange for translation or interpreter services to ensure informed consent
Fair claims handling requires that claimants fully understand settlement terms, which may require providing translation or interpreter assistance.
Under most state laws, once a proof of loss is submitted, within how many days must an insurer accept or deny a claim?
Answer: 30 days
Most state regulations require insurers to accept or deny a claim within 30 days after receiving a complete proof of loss.
Which documentation is most critical for an adjuster to obtain when closing a property damage claim?
Answer: A signed proof of loss and signed release or settlement agreement
Signed proof of loss and a signed release or settlement agreement create the legal record that the claim has been properly resolved.