Claims Settlement & Negotiation Flashcards
6 cards from real CCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Claims Settlement & Negotiation flashcards as text
What is the purpose of a general release in claims settlement?
Answer: To finalize a settlement by having the claimant waive all future claims related to the incident
A general release is a legal document signed by the claimant upon settlement, releasing the insurer and insured from any further liability related to the claim.
What is the duty of good faith in claims handling?
Answer: The insurer's obligation to handle claims fairly, promptly, and without unreasonable denial
The duty of good faith requires insurers to investigate claims thoroughly, communicate honestly, pay valid claims promptly, and not unreasonably deny or delay legitimate claims.
What constitutes bad faith claims handling?
Answer: Unreasonable denial, delay, or undervaluation of a legitimate insurance claim
Bad faith occurs when an insurer unreasonably denies valid claims, delays payment, fails to investigate, lowballs settlements, or uses deceptive practices in claims handling.
What factors should a claims professional consider when evaluating a bodily injury claim's value?
Answer: Medical expenses, lost wages, pain and suffering, permanency, and liability assessment
Evaluating a bodily injury claim requires considering all medical expenses, past and future lost wages, pain and suffering, permanency of injury, liability allocation, and any special damages.
What is an advance payment in claims settlement?
Answer: A partial payment made before final settlement to help the claimant with immediate expenses
An advance payment provides the claimant with partial funds before the final settlement is reached, typically for urgent medical expenses or emergency living costs.
What is structured settlement and when is it appropriate?
Answer: A settlement paid in periodic installments rather than a lump sum, often for serious long-term injuries
A structured settlement provides periodic payments over time rather than a single lump sum, often used for serious injuries to ensure ongoing financial support and provide tax advantages.