Claims Management and Handling Flashcards
7 cards from real RIBO 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 Management and Handling flashcards as text
When a client notifies a broker of a potential claim, what is the broker's primary responsibility?
Answer: Document the claim details and promptly notify the insurer on behalf of the client
The broker must document the claim and promptly notify the insurer to protect the client's interests and ensure timely processing under the policy.
What is subrogation in the context of insurance claims?
Answer: The insurer's right to pursue a negligent third party to recover claim payments made to the insured
Subrogation transfers the insured's right of recovery against a negligent third party to the insurer after the insurer has paid the claim.
Under the Ontario Insurance Act, what is a 'Proof of Loss'?
Answer: A statutory sworn statement the insured must submit detailing the circumstances and amount of a loss
A Proof of Loss is a sworn statement required by the Ontario Insurance Act's Statutory Conditions that the insured must submit within 60 days of the loss, detailing the facts and amount claimed.
What is the primary role of an insurance adjuster in the claims process?
Answer: To investigate the loss, evaluate damages, and negotiate a fair settlement on behalf of the insurer
An adjuster's role is to investigate the facts, assess the value of the loss, and negotiate a settlement that is fair and consistent with the policy terms.
What does the principle of 'indemnity' mean in insurance?
Answer: Restoring the insured to the same financial position they were in immediately before the loss
The principle of indemnity ensures the insured is neither better nor worse off financially after a loss—they are simply restored to their pre-loss position.
In property insurance claims, what is 'betterment'?
Answer: A deduction applied when repairs or replacements improve the property beyond its pre-loss condition
Betterment is applied to prevent the insured from profiting from a loss—if new materials replace old ones, the insurer deducts the value of the improvement consistent with the indemnity principle.
What is the primary purpose of a deductible in an insurance policy?
Answer: To share risk between the insurer and insured and discourage small or frivolous claims
A deductible requires the insured to absorb the first portion of each loss, promoting shared responsibility and reducing the frequency of minor claims.