CALA Negotiation & Settlement Techniques 2

Question 1

A claimant demands $50,000 but the adjuster's reserve is $30,000. What is the most effective opening negotiation tactic?

Accepted Answer

Present a documented counteroffer with supporting rationale

Answer

A documented counteroffer with supporting rationale anchors the negotiation and demonstrates good faith.

Question 2

What does the term 'bracketing' mean in claims negotiation?

Accepted Answer

Making offers and counteroffers that bracket the target settlement

Answer

Bracketing involves making offers and receiving counteroffers that progressively narrow toward a target settlement figure.

Question 3

When a claimant attorney sends a time-limited demand, what is the adjuster's primary obligation?

Accepted Answer

Respond within the demand deadline or document reasons for delay

Answer

Failure to respond to a time-limited demand within the deadline can expose the insurer to bad faith claims.

Question 4

What is 'nuisance value' in claims settlement?

Accepted Answer

A small payment to resolve a weak claim and avoid litigation costs

Answer

Nuisance value is a modest payment made to close a claim with low merit simply to avoid the cost and hassle of litigation.

Question 5

An adjuster is negotiating with an unrepresented claimant. Which ethical rule is most critical?

Accepted Answer

Treat the claimant fairly and not take advantage of their lack of legal representation

Answer

Adjusters have an ethical and legal duty of good faith that requires fair dealing, especially with unrepresented parties.

(CALA) Certified All-Lines Adjuster Practice Test