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
An adjuster who delays a valid claim settlement to pressure the claimant into accepting a lower amount is engaging in:
Answer: Bad faith claims handling
Using delay as a negotiating tactic to force a low settlement constitutes bad faith and violates unfair claims settlement practice statutes.
A 'reservation of rights' letter sent by an insurer to an insured serves to:
Answer: Notify the insured that the insurer will investigate while preserving the right to deny coverage later
A reservation of rights letter allows the insurer to investigate a claim without waiving potential coverage defenses.
Which type of adjuster is an employee of the insurance company and handles claims exclusively for that insurer?
Answer: Staff adjuster
Staff adjusters are salaried employees who work exclusively for one insurance company.
Under HIPAA, a claims adjuster handling a health-related claim must:
Answer: Protect the privacy of the claimant's protected health information (PHI)
HIPAA mandates strict privacy protections for protected health information, which applies to insurance claims involving medical data.
The 'reasonable person' standard in claims ethics is used to determine:
Answer: Whether an adjuster acted as a prudent professional would under similar circumstances
The reasonable person standard evaluates adjuster conduct against what a competent, prudent professional would do in similar circumstances.
An insured submits a fraudulent claim. Which of the following remedies is generally available to the insurer?
Answer: Voidance of the policy and criminal referral
Insurance fraud allows the insurer to void the policy ab initio and refer the matter to law enforcement for criminal prosecution.
Which ethical obligation requires an adjuster to avoid situations where personal interests conflict with their duty to handle claims fairly?
Answer: Duty to avoid conflicts of interest
Adjusters must avoid conflicts of interest that could compromise their objectivity and impartial handling of claims.