CCP Claims Settlement & Negotiation 1

Question 1

What is the purpose of a general release in claims settlement?

Accepted Answer

To finalize a settlement by having the claimant waive all future claims related to the incident

Answer

A general release is a legal document signed by the claimant upon settlement, releasing the insurer and insured from any further liability related to the claim.

Question 2

What is the duty of good faith in claims handling?

Accepted Answer

The insurer's obligation to handle claims fairly, promptly, and without unreasonable denial

Answer

The duty of good faith requires insurers to investigate claims thoroughly, communicate honestly, pay valid claims promptly, and not unreasonably deny or delay legitimate claims.

Question 3

What constitutes bad faith claims handling?

Accepted Answer

Unreasonable denial, delay, or undervaluation of a legitimate insurance claim

Answer

Bad faith occurs when an insurer unreasonably denies valid claims, delays payment, fails to investigate, lowballs settlements, or uses deceptive practices in claims handling.

Question 4

What factors should a claims professional consider when evaluating a bodily injury claim's value?

Accepted Answer

Medical expenses, lost wages, pain and suffering, permanency, and liability assessment

Answer

Evaluating a bodily injury claim requires considering all medical expenses, past and future lost wages, pain and suffering, permanency of injury, liability allocation, and any special damages.

Question 5

What is an advance payment in claims settlement?

Accepted Answer

A partial payment made before final settlement to help the claimant with immediate expenses

Answer

An advance payment provides the claimant with partial funds before the final settlement is reached, typically for urgent medical expenses or emergency living costs.

(CCP) Certified Claims Professional Practice Test

(CCP) Certified Claims Professional Practice Test

CCP Claims Settlement & Negotiation 1