CCP Claims Settlement & Negotiation 2

Question 1

In a structured settlement, periodic payments are typically funded through which financial instrument?

Accepted Answer

Annuity contract

Answer

Structured settlements are funded by annuity contracts purchased from life insurance companies, providing guaranteed periodic payments.

Question 2

A claimant's attorney demands $200,000 for a disputed soft-tissue injury. The adjuster's reserve is $60,000. What is the most appropriate initial response?

Accepted Answer

Acknowledge the demand and request supporting medical documentation

Answer

The adjuster should acknowledge the demand and request substantiating documentation before making any counter-offer.

Question 3

Which negotiation technique involves deliberately understating the initial offer to leave room for concessions?

Accepted Answer

Bracketing

Answer

Bracketing sets an opening offer strategically below the target settlement so the midpoint of demand and offer lands near the desired outcome.

Question 4

Under the Unfair Claims Settlement Practices Act, failing to attempt a prompt, fair, and equitable settlement when liability is reasonably clear constitutes:

Accepted Answer

An unfair claims practice

Answer

The UCSPA prohibits failing to settle claims promptly when liability is clear, classifying it as an unfair claims settlement practice.

Question 5

What does 'Mary Carter agreement' refer to in claims settlement?

Accepted Answer

A secret settlement where one defendant stays in the case while reducing claimant's recovery

Answer

A Mary Carter agreement is a secret contract where a settling defendant remains in the lawsuit but has a financial stake in the outcome against the non-settling defendant.

(CCP) Certified Claims Professional Practice Test

(CCP) Certified Claims Professional Practice Test

CCP Claims Settlement & Negotiation 2