CALA Settlement Procedures 2

Question 1

When a claimant disputes the adjuster's vehicle damage estimate, what is the most appropriate first step?

Accepted Answer

Request an independent appraisal

Answer

Requesting an independent appraisal is the standard dispute resolution mechanism before escalating to litigation.

Question 2

A 'reservation of rights' letter in a settlement context primarily serves to:

Accepted Answer

Preserve the insurer's right to deny coverage while still investigating

Answer

A reservation of rights letter allows the insurer to continue investigating without waiving any coverage defenses.

Question 3

Under the Unfair Claims Settlement Practices Act, how many days does an insurer typically have to acknowledge receipt of a claim?

Accepted Answer

10 days

Answer

Most state regulations based on the UCSPA require acknowledgment within 10 days of receiving a claim.

Question 4

What does 'accord and satisfaction' mean in automotive loss settlement?

Accepted Answer

A disputed claim is fully resolved when a claimant cashes a check marked 'payment in full'

Answer

Accord and satisfaction occurs when a claimant accepts a settlement offer, typically by cashing a check tendered as full payment.

Question 5

Which settlement option allows the insured to keep a totaled vehicle while receiving a reduced payment?

Accepted Answer

Salvage retention by insured

Answer

When an insured retains salvage, the insurer deducts the salvage value from the ACV payment.

(CALA) Certified Automotive Loss Adjuster Practice Test