Insurance Quality Control & Assurance 2 — Questions and Answers
Question 1: Which metric is most commonly used to measure claim settlement accuracy in an insurance QA program?
- Claim cycle time
- Error rate per 100 claims processed (Correct answer)
- Net promoter score
- Premium-to-loss ratio
Correct answer: Error rate per 100 claims processed
Error rate per 100 claims processed is the standard QA metric for measuring how accurately claims are being settled.
Question 2: What is the primary purpose of a file review audit in insurance quality assurance?
- To calculate reserves
- To verify that claim files comply with handling guidelines and regulations (Correct answer)
- To determine agent commission rates
- To set new premium rates
Correct answer: To verify that claim files comply with handling guidelines and regulations
File review audits evaluate whether claim handlers are following established guidelines, best practices, and regulatory requirements.
Question 3: In insurance QA, a 'corrective action plan' (CAP) is triggered when:
- An insurer posts record profits
- An employee receives a promotion
- Quality scores fall below an established threshold (Correct answer)
- A new policy form is approved
Correct answer: Quality scores fall below an established threshold
A corrective action plan is initiated when quality metrics drop below the minimum acceptable performance level to address the root cause.
Question 4: Which of the following best describes 'inter-rater reliability' in an insurance QA context?
- The consistency of results when different auditors review the same file (Correct answer)
- The ratio of premiums collected to claims paid
- The speed at which claims are processed
- The accuracy of reinsurance reporting
Correct answer: The consistency of results when different auditors review the same file
Inter-rater reliability measures how consistently different QA reviewers score the same claim file, ensuring audit fairness.
Question 5: A 'random sampling' QA approach in claims auditing means:
- Only high-value claims are reviewed
- Files are selected without bias to represent the entire claims population (Correct answer)
- Only denied claims are reviewed
- Auditors choose whichever files they prefer
Correct answer: Files are selected without bias to represent the entire claims population
Random sampling ensures every claim has an equal chance of selection, providing an unbiased picture of overall performance.
Question 6: Which regulation most directly requires insurance carriers to maintain quality assurance programs for claims handling in the US?
- The Sherman Antitrust Act
- State Unfair Claims Settlement Practices Acts (Correct answer)
- The Sarbanes-Oxley Act
- The Employee Retirement Income Security Act (ERISA)
Correct answer: State Unfair Claims Settlement Practices Acts
State Unfair Claims Settlement Practices Acts establish standards for timely and fair claims handling that QA programs must ensure compliance with.
Question 7: What does a 'touchpoint audit' evaluate in insurance operations?
- The physical condition of company office buildings
- Each customer interaction point across the service lifecycle (Correct answer)
- The number of agents assigned to a territory
- Internal IT system uptime
Correct answer: Each customer interaction point across the service lifecycle
A touchpoint audit assesses quality at every stage a customer contacts the insurer — from first notice of loss through final payment.
Insurance Quality Control & Assurance 2
Which metric is most commonly used to measure claim settlement accuracy in an insurance QA program?