Laws, Regulations, and Ethics Flashcards
7 cards from real CCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Laws, Regulations, and Ethics flashcards as text
Under the NAIC Unfair Claims Settlement Practices Act, 'knowingly misrepresenting pertinent facts' to a claimant is considered:
Answer: An unfair claims settlement practice
Knowingly misrepresenting facts or policy provisions is explicitly listed as an unfair claims settlement practice under the NAIC model act.
A public adjuster's primary duty is owed to:
Answer: The policyholder
Unlike staff or independent adjusters, public adjusters are hired by and represent the interests of the policyholder.
Which ethical standard requires an adjuster to disclose all information relevant to a claim, even if it benefits the claimant?
Answer: Duty of utmost good faith (uberrimae fidei)
Uberrimae fidei (utmost good faith) obligates both parties in an insurance contract to full and honest disclosure.
State insurance regulations that govern claims handling practices are primarily enforced by:
Answer: The state insurance commissioner or department
Insurance regulation in the U.S. is primarily state-based, with each state's insurance commissioner holding enforcement authority.
An adjuster who closes a claim without properly investigating because the amount is small is violating the duty of:
Answer: Reasonable investigation
Adjusters are legally and ethically required to conduct a reasonable investigation regardless of the claim's monetary value.
Which of the following best describes 'twisting' in the context of insurance ethics?
Answer: Inducing a policyholder to cancel a policy to buy another through misrepresentation
Twisting involves using misrepresentation or deception to convince a policyholder to switch policies, often to the agent's financial benefit.
A claimant's attorney requests the complete claim file from the adjuster. Under most state laws, the adjuster should:
Answer: Consult with legal counsel and follow applicable discovery rules
Claim file disclosure is governed by state discovery rules and privilege laws, requiring legal counsel guidance before production.