Claims Investigation & Evaluation Flashcards
7 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 7 Claims Investigation & Evaluation flashcards as text
When a liability claim involves a claimant who is a minor, what special procedural requirement typically applies to any settlement?
Answer: Court approval of the settlement is usually required to bind the minor
Settlements involving minors generally require court approval (minor's compromise) to ensure the settlement is in the minor's best interest and to obtain a valid, binding release.
What is the significance of 'comparative fault' jurisdictions for adjusters evaluating liability claims?
Answer: The claimant's damages are reduced proportionally by their percentage of fault
In comparative fault states, a claimant's recovery is reduced by their percentage of fault, so adjusters must assess both parties' negligence to calculate the appropriate damages.
A homeowner's policy excludes 'earth movement.' A retaining wall collapses due to soil saturation from a covered water event. How should the adjuster analyze coverage?
Answer: Analyze whether the efficient proximate cause was the covered water event or the excluded earth movement
The efficient proximate cause rule requires identifying the dominant cause of loss; if a covered peril (water) set the excluded peril (earth movement) in motion, coverage analysis depends on which was the efficient proximate cause.
Which element is NOT required to establish a negligence claim against the insured?
Answer: The insured's intent to cause harm
Negligence is an unintentional tort; the claimant must prove duty, breach, causation, and damages — intent to harm is not a required element and is actually inconsistent with negligence.
What is the function of 'surveillance' as an investigative tool in bodily injury claims?
Answer: To obtain objective evidence of the claimant's actual physical capabilities
Surveillance is used to document the claimant's actual daily activities and physical abilities, which may confirm or contradict their reported injury limitations.
When an adjuster identifies potential fraud indicators on a claim, what is the FIRST action that should be taken?
Answer: Refer the claim to the Special Investigations Unit (SIU) for review
Suspected fraud should be referred promptly to the SIU, which has specialized investigators trained to develop evidence and coordinate with law enforcement.
Which valuation approach is typically used for a total loss vehicle in a first-party auto claim?
Answer: Actual cash value based on comparable vehicles in the local market
Total loss vehicles are valued at actual cash value, determined by comparing similar vehicles in the local market adjusted for mileage, condition, and options.