Claims Management and Loss Control Flashcards
7 cards from real TRIP 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 Loss Control flashcards as text
Which approach to claims management is most likely to reduce litigation costs in bodily injury claims from transportation accidents?
Answer: Early intervention and proactive settlement with injured parties
Early intervention and proactive settlement reduces litigation costs by resolving claims before attorney involvement escalates expenses and damages awards.
A transportation company's loss run shows a high frequency of minor cargo claims but low severity per claim. The BEST loss control response is to:
Answer: Investigate root causes such as packaging standards and handling procedures
High-frequency, low-severity cargo losses typically stem from correctable operational issues like inadequate packaging or handling, making root cause investigation and process improvement the most effective response.
Under a Truckers' General Liability (TGL) policy, which type of injury claim would typically NOT be covered?
Answer: Employee injuries covered under workers' compensation
TGL policies exclude employee injuries because workers' compensation is the mandatory coverage for on-the-job injuries to employees, a separate statutory line of coverage.
What is a 'captive insurance company' and why might a large transportation fleet use one?
Answer: A company-owned insurer that retains the transportation firm's risk and captures underwriting profit
A captive is an insurance company owned by the insured entity, allowing the transportation firm to retain premium income and underwriting profit while maintaining control over claims handling.
In the context of transportation claims, what is 'excess coverage' and when does it apply?
Answer: Coverage that applies only after the primary policy's limits are fully exhausted
Excess coverage only responds after the underlying primary policy limits have been completely exhausted by a covered loss, providing additional capacity for catastrophic claims.
A fleet safety manager notices an increase in distracted driving incidents among drivers using company-issued smartphones. Which loss control measure directly addresses this hazard?
Answer: Implementing a hands-free technology policy and mobile device management (MDM) software
A hands-free policy combined with MDM software that restricts non-essential phone functions while driving directly targets distracted driving caused by smartphone use.
What does the term 'incurred but not reported' (IBNR) represent in transportation insurance reserving?
Answer: Estimated liability for losses that have occurred but not yet been reported to the insurer
IBNR reserves represent the actuarial estimate of losses that have already happened but where the insured has not yet filed a claim, essential for accurate financial reserving.