Claims Investigation & Evaluation Flashcards
7 cards from real CCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Claims Investigation & Evaluation flashcards as text
Which standard most commonly applies when determining whether a liability insurer must defend an insured against a lawsuit?
Answer: The four-corners rule: if the complaint allegations potentially trigger coverage, a duty to defend exists
The four-corners (or eight-corners) rule requires the insurer to defend if the complaint's allegations, on their face, could potentially fall within policy coverage.
In a construction defect claim, what is 'consequential damage'?
Answer: Damage to other property or components caused by the defective work
Consequential damages in construction defect claims refer to harm caused to surrounding property (e.g., water intrusion damaging interiors) as a result of the defective construction.
A claimant's vehicle was damaged in an accident caused by an uninsured driver. Under the insured's UM/UIM coverage, what must the adjuster typically establish?
Answer: That the at-fault driver was legally uninsured and legally liable for the accident
UM/UIM claims require the adjuster to confirm the at-fault driver lacked insurance and was legally liable for the accident before coverage applies.
When a claims file is selected for litigation, which action is most critical before transferring the file to defense counsel?
Answer: Ensuring the file is complete, organized, and that all investigation activity and coverage decisions are documented
A complete, well-documented claim file is essential for defense counsel to understand the investigation history and support the insurer's coverage and liability positions.
What is the purpose of an 'examination of books and records' in a commercial property claim?
Answer: To verify the accuracy of claimed business income losses using the insured's financial records
Examining business financial records allows the adjuster or forensic accountant to verify that claimed business income losses are supported by actual historical financial performance.
Which of the following is an example of 'moral hazard' in claims investigation?
Answer: An insured who is more careless about loss prevention because they know they are fully insured
Moral hazard refers to the tendency of insured parties to take less care to prevent losses because they know the insurer will cover them.
A homeowner's policy covers 'collapse' of a building. An insured claims their deck 'collapsed.' Under most policy definitions, collapse coverage most likely applies when:
Answer: There is an abrupt falling down or caving in of the structure making it unfit for intended use
Most policy definitions require an abrupt, sudden falling or caving in of a structural component rendering it unusable, not merely settling, sagging, or cosmetic deterioration.