AIC 301 EXAM: LATEST A+ QUESTIONS AND ANSWERS
BREAKDOWN
what are the two primary goals of the claims dept?
keep insurers promise & help insurer reach profit goal
What is the insurers promise?
to uphold the contract made on the policy (First or Third), and to protect the insured from lawsuits in
claims that are found wrong
What is the insurers promise in a property insurance policy?
Pay for damages made by the claimant/policyholder to any property if fits the policy.
What is the insurers promise in liability insurance policy?
pay for damages done to OTHERS (bodily injuries, property damage or other)
When is the insurer responsible to pay first party claims?
direct report from insured to insurer.
When is the insurer responsible to pay third party claims?
made against the policyholder by someone to whom the policyholder may be liable
By ensuring fair claim settlement, claims representatives prevent any unnecessary increase in the cost
of insurance and subsequent reduction in the insurer's
underwriting profit
An insurance contract is designed to be all of the following in the event of a claim, EXCEPT
A means to provide a profit to the insured
Third Party Administrator (TPA)
An organization that provides administrative services associated with risk financing and insurance.
Independent Adjuster
An independent claim representative who handles claims for insurers for a fee.
Producer
term "producer" includes agents, brokers, sales representatives, and intermediaries who place insurance
with insurers
Public Adjuster
An outside organization or person hired by an insured to represent the insured in a claim in exchange for
a fee.
, Loss adjustment expense (LAE)
The expense that an insurer incurs to investigate, defend, and settle claims according to the terms
specified in the insurance policy.
Which one of the following involves making a choice between what is lawful and what is unlawful?
legality
For insurers, ethical and professional conduct can help
retain customers and attract investors
Ethics and professionalism are important for insurance professionals because
Consumer regulations may define the minimum expected ethical and professional standards.
Three ways good faith is established:
By satisfying contractual duties and other promises
By maintaining insurers' credibility
By complying with legal duty
If the business of insurance is conducted ethically and professionally, society can reap the benefits of
insurance, which include
support for credit
Most states require the licensing of
public adjusters
Some jurisdictions have found certain practices in claim handling to be the unauthorized practice of
law. An typical example is
Providing direction on legal strategies
Ethical and professional conduct of claim representatives can benefit consumers by
Encouraging fair treatment and prompt payment.
If the business of insurance is conducted ethically and professionally, society can reap the benefits of
insurance, which include
the benefits of insurance include peace of mind, support for credit, efficient use of resources, and
reduction of social burdens.
Ethical and professional conduct of claim representatives can benefit consumers by
Encouraging fair treatment and prompt payment.
Ethics and professionalism are important for insurance professionals because
Consumer regulations may define the minimum expected ethical and professional standards.
BREAKDOWN
what are the two primary goals of the claims dept?
keep insurers promise & help insurer reach profit goal
What is the insurers promise?
to uphold the contract made on the policy (First or Third), and to protect the insured from lawsuits in
claims that are found wrong
What is the insurers promise in a property insurance policy?
Pay for damages made by the claimant/policyholder to any property if fits the policy.
What is the insurers promise in liability insurance policy?
pay for damages done to OTHERS (bodily injuries, property damage or other)
When is the insurer responsible to pay first party claims?
direct report from insured to insurer.
When is the insurer responsible to pay third party claims?
made against the policyholder by someone to whom the policyholder may be liable
By ensuring fair claim settlement, claims representatives prevent any unnecessary increase in the cost
of insurance and subsequent reduction in the insurer's
underwriting profit
An insurance contract is designed to be all of the following in the event of a claim, EXCEPT
A means to provide a profit to the insured
Third Party Administrator (TPA)
An organization that provides administrative services associated with risk financing and insurance.
Independent Adjuster
An independent claim representative who handles claims for insurers for a fee.
Producer
term "producer" includes agents, brokers, sales representatives, and intermediaries who place insurance
with insurers
Public Adjuster
An outside organization or person hired by an insured to represent the insured in a claim in exchange for
a fee.
, Loss adjustment expense (LAE)
The expense that an insurer incurs to investigate, defend, and settle claims according to the terms
specified in the insurance policy.
Which one of the following involves making a choice between what is lawful and what is unlawful?
legality
For insurers, ethical and professional conduct can help
retain customers and attract investors
Ethics and professionalism are important for insurance professionals because
Consumer regulations may define the minimum expected ethical and professional standards.
Three ways good faith is established:
By satisfying contractual duties and other promises
By maintaining insurers' credibility
By complying with legal duty
If the business of insurance is conducted ethically and professionally, society can reap the benefits of
insurance, which include
support for credit
Most states require the licensing of
public adjusters
Some jurisdictions have found certain practices in claim handling to be the unauthorized practice of
law. An typical example is
Providing direction on legal strategies
Ethical and professional conduct of claim representatives can benefit consumers by
Encouraging fair treatment and prompt payment.
If the business of insurance is conducted ethically and professionally, society can reap the benefits of
insurance, which include
the benefits of insurance include peace of mind, support for credit, efficient use of resources, and
reduction of social burdens.
Ethical and professional conduct of claim representatives can benefit consumers by
Encouraging fair treatment and prompt payment.
Ethics and professionalism are important for insurance professionals because
Consumer regulations may define the minimum expected ethical and professional standards.
