AIC 300 - Claims in an Evolving World
Antonia has a general liability policy with a self-insured retention of $50,000. The policy has an
occurrence limit of $250,000 and an aggregate limit of $500,000. She had submitted one prior claim this
policy term for which $100,000 was paid by the insurer. How much will Antonia's insurer pay on a
subsequent claim under the same policy period that is valued at $400,000?
Select one:
A. $200,000
B. $250,000
C. $400,000
D. $500,000 - B. $250,000
After the SIR limit had been reached, the insurer was obligated to pay up to the occurrence limit.
Among the methods used to pay claims are the issuance of checks and bank drafts. The main difference
between the two is that
Select one:
A. Only checks may be used for claim payments in excess of $10,000.
B. With a check, the bank must verify that the insurer has authorized payment.
C. Only bank drafts may be used for claim payments in excess of $10,000.
D. With a bank draft, the bank must verify that the insurer has authorized payment. - D. With a
bank draft, the bank must verify that the insurer has authorized payment.
Aaron works for a multi-line insurer. He works with insurance producers and applicants to evaluate new
business submissions and conduct renewal underwriting. Aaron is a
Select one:
A. Staff underwriter.
B. Public underwriter.
C. Personal lines underwriter.
,D. Line underwriter. - D. Line underwriter.
Line underwriter. This describes the duties of a line underwriter, rather than a staff underwriter. There is
not enough information to determine which line of business is being written. A public underwriter does
not exist. Line underwriters evaluate new submissions and perform renewal underwriting, usually by
working directly with insurance producers and applicants. Staff underwriters, meanwhile, manage risk
selection by working with line underwriters and coordinating decisions about products, pricing and
guidelines.
Adam manages a claims department for an insurer. He measures the department's performance by best
practices, claims audits, customer satisfaction data, and loss ratio. Which one of Adam's measures refers
to a system of identified internal practices that claims representatives perform to produce superior
performance?
Select one:
A. Customer satisfaction data
B. Loss ratio
C. Best practices
D. Claims audits - C. Best practices
Best practices generally refers to a system of identified internal practices that are shared with claims reps
and produce superior performance.
Although most policies are occurrence forms, covering claims that occur during the policy period, some
are claims-made forms. Which one of the following types of loss is most likely to involve a claims-made
form?
Select one:
A. An automotive collision claim.
B. A homeowners liability claim due to a slip and fall.
C. A homeowners claim due to storm damage.
D. A medical malpractice claim. - D. A medical malpractice claim.
Claims-made forms are most often used for environmental, medical malpractice and directors and
officers' policies.
,Alva works for an international, multi-line insurer. She helps her company to manage risk selection by
working with other underwriters and coordinating decisions about products, pricing, and guidelines. Alva
is a
Select one:
A. Master underwriter.
B. Line underwriter.
C. Staff underwriter.
D. Chief Underwriting Officer. - C. Staff underwriter.
This describes the duties of a staff underwriter. Line underwriter. This describes the duties of a line
underwriter, rather than a staff underwriter. There is not enough information to determine which line of
business is being written. A public underwriter does not exist. Line underwriters evaluate new
submissions and perform renewal underwriting, usually by working directly with insurance producers
and applicants. Staff underwriters, meanwhile, manage risk selection by working with line underwriters
and coordinating decisions about products, pricing and guidelines.
A claims representative should have the ability to persuade or influence
Select one:
A. Supervisors.
B. Insureds.
C. Claimants, insureds, supervisors and others.
D. Claimants. - C. Claimants, insureds, supervisors and others.
The impression that claims reps make on claimants, insureds, and others reflects either favorably or
unfavorably on the insurer.
An insurer that finds it economically impractical to establish a claims office in a given state is likely to use
which one of the following to perform the claims handling function?
Select one:
A. Producers
, B. Third-party administrators
C. Public adjusters
D. Independent adjusters - D. Independent adjusters
Insurers may contract with independent adjusters to handle claims in strategic locations.
Andrew is a claims representative investigating whether coverage applies to a new claim. To help ensure
that he considers every facet of the policy before determining coverage, he might use
Select one:
A. The CARD method.
B. The CARE method.
C. The DICE method.
D. The DARE method. - C. The DICE method.
As a claims representative, Beatrice is on the front lines for protecting her employer from insurance
fraud. Beatrice should understand that insurance fraud
Select one:
A. Is the costliest white-collar crime in the U.S.
B. Accounts for 25 percent of the P&C industry incurred losses.
C. Costs roughly $40 billion per year, excluding health insurance.
D. Costs each American family between $2,000 and $4,000 per year. - C. Costs roughly $40 billion
per year, excluding health insurance.
As a claims representative, Joshua frequently requests proofs of loss and affidavits, and conducts
examinations under oath and recorded statements. Which one of Joshua's sworn statements is
administered by the insurer's attorney at the office of the insurer, attorney, or court reporter?
Select one:
A. Affidavit
B. Examination under oath
