Risk Management & Fraud Prevention in Claims Handling Flashcards
7 cards from real CALA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Management & Fraud Prevention in Claims Handling flashcards as text
Which red flag most strongly suggests a staged collision between two cooperating drivers?
Answer: Both vehicles show damage inconsistent with the described impact angle
Damage inconsistent with the reported impact angle is a primary physical indicator of a staged collision.
A claimant submits repair invoices totaling $8,400 but the adjuster's appraisal is $3,200. What is this discrepancy most likely called?
Answer: Inflated repair fraud
When repair invoices significantly exceed a fair appraisal without justification, it is classified as inflated repair fraud.
What does the term 'sliding' mean in the context of insurance fraud?
Answer: Adding unauthorized coverages to a policy without the insured's knowledge
Sliding is an agent-level fraud where coverages are added to a policy without the policyholder's knowledge or consent.
Under the ISO ClaimSearch database, what is the primary purpose of cross-referencing a claimant's prior claims history?
Answer: To identify patterns of suspicious or repeated claims
ISO ClaimSearch is used to identify claimants with patterns of repeated or suspicious prior claims across multiple insurers.
An adjuster notices a vehicle was reported stolen two days after the insured defaulted on auto loan payments. Which fraud category does this most likely represent?
Answer: Hard fraud (owner give-up)
A vehicle reported stolen shortly after financial distress is a classic 'owner give-up,' a premeditated hard fraud scheme.
Which method is MOST effective for detecting phantom passenger fraud in an auto accident claim?
Answer: Obtaining recorded statements from each alleged occupant separately
Separate recorded statements from alleged occupants often reveal inconsistencies that expose phantom passenger schemes.
A body shop bills for OEM parts but installs aftermarket parts and keeps the price difference. This scheme is known as:
Answer: Parts substitution fraud
Parts substitution fraud occurs when a shop bills for more expensive OEM parts but installs cheaper aftermarket equivalents.