CALA Settlement Procedures 3

Question 1

An adjuster discovers the claimant's vehicle was already damaged prior to the reported accident. The best course of action is to:

Accepted Answer

Document pre-existing damage separately and settle only for the new loss

Answer

Deny the entire claim without investigation

Answer

Pay the full estimate to avoid litigation

Answer

Request a police report and close the file

Question 2

What is the purpose of a 'proof of loss' form in the settlement process?

Accepted Answer

It is a sworn statement by the insured detailing the loss and claimed amount

Answer

It authorizes the repair shop to begin work

Answer

It transfers title of a totaled vehicle to the insurer

Answer

It releases all future claims against the insurer

Question 3

When a claimant refuses to accept an ACV offer for a total loss, the adjuster should:

Accepted Answer

Explain the ACV calculation methodology and consider obtaining a second valuation

Answer

Immediately escalate to litigation

Answer

Offer to repair the vehicle regardless of cost

Answer

Deduct 20% as a penalty for non-acceptance

Question 4

A subrogation waiver in a settlement agreement means the insurer:

Accepted Answer

Gives up its right to pursue recovery from a third party

Answer

Retains the right to recover from the at-fault party

Answer

Requires the insured to pursue recovery independently

Answer

Increases the deductible applied to future claims

Question 5

Which document formally transfers ownership of a total-loss vehicle to the insurer?

Accepted Answer

Title assignment or certificate of title

Answer

Proof of loss form

Answer

Release of liability

Answer

Authorization to repair

Question 6

An insured has a $500 collision deductible. The repair estimate is $3,200. How much does the insurer pay the shop?

Accepted Answer

$2,700

Answer

$3,200

Answer

$3,700

Answer

$500

Question 7

What is 'betterment' in the context of automotive claim settlements?

Accepted Answer

A deduction applied when new parts replace worn components, improving the vehicle's condition beyond pre-loss state

Answer

A bonus paid when the vehicle is repaired faster than estimated

Answer

An upgrade the insured must pay to receive OEM parts

Answer

A surcharge for luxury vehicle repairs