CA Loss Assessment & Damage Valuation Flashcards
6 cards from real CA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CA Loss Assessment & Damage Valuation flashcards as text
Which type of loss involves damage to a third party's property caused by the insured, triggering the liability portion of a policy?
Answer: Third-party loss
A third-party loss arises when the insured is liable for damage to someone else's property or person, engaging the liability coverage of the policy.
In California property claims, 'betterment' refers to:
Answer: A reduction in settlement when repairs improve the property beyond its pre-loss condition
Betterment is a deduction applied when repairs result in a material improvement over the pre-loss condition, preventing the insured from profiting from the claim.
A California adjuster conducting a scope of loss inspection should document which of the following?
Answer: All damaged areas with measurements, photos, and written notes
A thorough scope of loss requires documentation of all damaged areas including measurements, photographs, and detailed notes to support an accurate estimate.
What is the purpose of a 'reservation of rights' letter in a California claim?
Answer: To inform the insured the claim is being investigated while coverage may be in question
A reservation of rights letter preserves the insurer's right to deny coverage while still conducting an investigation, without waiving any policy defenses.
Which valuation approach is most appropriate for a unique commercial property with no comparable sales data?
Answer: Cost approach
The cost approach estimates value based on the cost to reproduce or replace the structure minus depreciation, making it suitable when comparable sales are unavailable.
Under California Insurance Code, how many days does an insurer generally have to accept or deny a claim after receiving proof of loss?
Answer: 40 days
California Insurance Code § 790.03 and the Fair Claims Settlement Practices Regulations require insurers to accept or deny a claim within 40 days of receiving the proof of loss.