CCA Laws, Regulations, and Ethics 5

Question 1

An adjuster who delays a valid claim settlement to pressure the claimant into accepting a lower amount is engaging in:

Accepted Answer

Bad faith claims handling

Answer

Using delay as a negotiating tactic to force a low settlement constitutes bad faith and violates unfair claims settlement practice statutes.

Question 2

A 'reservation of rights' letter sent by an insurer to an insured serves to:

Accepted Answer

Notify the insured that the insurer will investigate while preserving the right to deny coverage later

Answer

A reservation of rights letter allows the insurer to investigate a claim without waiving potential coverage defenses.

Question 3

Which type of adjuster is an employee of the insurance company and handles claims exclusively for that insurer?

Accepted Answer

Staff adjuster

Answer

Staff adjusters are salaried employees who work exclusively for one insurance company.

Question 4

Under HIPAA, a claims adjuster handling a health-related claim must:

Accepted Answer

Protect the privacy of the claimant's protected health information (PHI)

Answer

HIPAA mandates strict privacy protections for protected health information, which applies to insurance claims involving medical data.

Question 5

The 'reasonable person' standard in claims ethics is used to determine:

Accepted Answer

Whether an adjuster acted as a prudent professional would under similar circumstances

Answer

The reasonable person standard evaluates adjuster conduct against what a competent, prudent professional would do in similar circumstances.

(CCA) Certified Claims Adjuster Practice Test