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114 Cards in this Set
- Front
- Back
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conflict of interest
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a situation that occurs when a decision makers personal interests interfere to the extent that he/she makes decisions that adversely affect customers or employers |
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complying with legal duty
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establishing good faith by following regulatory and insurers' guidelines which help provide guidance to claim reps regarding ethical and professional claim handling conduct |
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maintaining insurers credibility
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establishing good faith by maintain a positive public perception; not making inappropriate claim denials, mishandling corporate funds or collusion between insurers and brokers to fix prices |
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satisfying contractual duties and other promises
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establishing good faith by complying with promises made in the insured's policy as well as following code's of conduct, maintaining education and licensing and conforming to a dress code |
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professionalism
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involves the behavior and qualities necessary to properly implement an ethical decisions; should act knowledgably, courteously and empathetically |
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ethics |
the set of principles and values that determines the better course of actions, given the choice between 2 or more legal courses of action; goes beyond merely obeying the law |
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customer satisfaction |
a claims performance measure that focuses on complaints and how to address them; they can reveal if problems exist with a particular claims rep, supervisor, or manager
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claims audits |
evaluation of quantitative and qualitative factors to ensure compliance with best practices and gather statistical information on claims. performed by evaluating the information in a number of open and closed claim files |
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best practices |
ex. every claim will be acknowledged within 24 hours |
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profitability measures |
measures losses and loss adjustment expenses against earned premiums; reflects the percent of premiums being consumed by losses |
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What are best practices, claims audits and customer satisfaction?
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claims performance measures |
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public adjuster
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an outside organization or person hired by an insured to prepare and negotiate a settlement; they are paid a percentage of the settlement by the insured |
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producers |
ex. agents, brokers, insurer employees similar to outside claims adjusters |
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third-party administrators |
used by businesses that choose to self-insure; handle claims, keep claims records, and perform statistical analyses often associated with independent adjusting firms or with subsidiaries of insurance companies |
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independent adjusters |
a claims representative who handles claims for a fee; the handle all field work; also handle claims during disasters and one in highly specialized fields |
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claims representative |
a person responsible for investigating, evaluating and settling claims; restores a claimant to the pre-loss condition |
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third-party claim
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a demand against an insured by a person or organization other than the insured or insurer, seeking to recover damages that may be payable by the insured liability insurance |
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arbitration |
An alternative dispute resolution (ARD) method by whichdisputing parties use a neutral outside party to examine the issues and developa settlement, which can be final and binding. |
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appraisal clause
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a policy provision that prescribes a method for resolving a disputed claim about the value of property or the amount of a property loss |
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mini-trial
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an alternative dispute method by which a case undergoes an abbreviated version of a trial before a panel or an adviser who poses questions and offers opinions on the outcome of a trial, based on the evidence presented |
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summary jury trial |
an alternative dispute resolution method by which disputing parties participate in an abbreviated trial, presenting the evidence of a few witnesses to a panel of mock jurors who decide the case |
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reserve |
the amount the insurer estimates and set aside to pay on an existing claim that has not been settled |
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individual case method |
a method of setting reserves based on the claim's circumstances and the claim rep's experience in handling similar claims |
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roundtable method |
a method of setting reserves by using the consensus of two or more claim personnel who have independently evaluated the claim file |
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average value method
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a case reserving method that establishes a predetermined dollar amount of reserve for each claim as it is reported |
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formula method
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a method of setting claim reserves by using a mathematical formula |
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expert system method |
a method of setting reserves with a software application that estimates losses and loss adjustment expenses |
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proof of loss |
a statement of facts about a loss for which the insured is making a claim |
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independent medical examiner (IME)
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a direct intervention technique that includes a brief review of the patient's history and treatment and a physical examination of the patient. insurers use this technique in disputed claims for determining causation, current physical impairment, and the need for present or future treatment |
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direct question
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a question that seeks specific information and that can often be answered with a short phrase or a yes or no response |
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open-ended question |
a question that seeks an answer that explains or elaborates on the circumstances under consideration |
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leading question |
a questions that seeks or suggests a particular answer
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sworn statement
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a signed record of events surrounding an event as told by the interviewee that contains language attesting that it is true |
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examination under oath (EUO) |
a statement given by a person who has sworn to tell the truth before an officer of the court |
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deposition |
a pretrial discovery toll involving oral examination of a witness to produce a written verbatim record |
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loss history |
a listing of past claims, including the date of occurrence, the line of business, the type or description of the claim, the date of the claim, the amount paid, the amount reserved and the claim's current status |
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loss reserve
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an estimate of the amount of money the insurer expects to pay in the future for losses that have already occurred and been reported, but are not yet settled |
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loss ratio
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a ratio that measures losses and loss adjustment expenses against earned premiums and that reflects the percentage of premiums being consumed by losses |
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sender |
the person who initiates the communication process |
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receiver |
the person who chooses from the verbal and nonverbal symbols in the sender's message to interpret the message's meaning |
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initial credibility |
the degree of credibility an individual has before interpersonal communication begins |
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derived credibility |
an individual's perceived credibility during interpersonal communication |
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terminal credibility |
an individual's perceived credibility after interpersonal communication in a given situation has occurred |
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message
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the words a sender uses in the communications process and their underlying theme |
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encoding |
the process of translating a message into words |
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medium |
the means by which a message is transmitted from sender to receiver |
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decoding |
the process by which a receiver interprets a sender's message |
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active listening |
the process of listening with mental and physical openness to more clearly determine a message's meaning |
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nonverbal communication
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communication that is not spoken or written, including eye movement, kinesics, appearance, and time and space |
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insurance fraud |
any deliberate deception committed against an insurer or an insurance producer for the purpose of unwarranted financial gain |
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material fact |
in insurance, a fact that would affect the insurer's decision to provide or maintain insurance or to settle a claim |
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staged accident |
an accident deliberate caused by a person who intend to feign injury and collect on the ensuing claim
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hard fraud |
actions that are undertaken deliberate to defraud |
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soft fraud/opportunity fraud |
fraud that occurs when a legitimate claim is exaggerated |
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misrepresentation |
a false statement of a material fact on which a party relies |
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concealment |
an intentional failure to disclose a material fact |
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summons |
a document that directs a sheriff or another court designated officer to notify the defendant named in the lawsuit that a lawsuit had been started and that the defendant has a specified amount of time to answer the complaint |
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complaint |
the allegations made by a plaintiff in a lawsuit
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answer |
a document filed in court by a defendant responding to a plaintiff's complaint and explaining why the plaintiff should not win the case |
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pleading |
a formal written statement of the fact and claim of each party to a lawsuit |
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discovery |
a pretrial exchange of all relevant information between the plaintiff and defendant |
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jurisdiction |
a particular court's power or authority to decide a lawsuit of a certain type or within a certain territory |
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venue |
the locale in which the lawsuit may be brought |
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service of process |
the delivery of a summons and complaint to a defendant by an authorized person |
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actual service |
hand delivery of a summons and complaint to a defendant |
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substituted service (constructive service) |
any method of notifying a defendant of a lawsuit other than person delivery of a summons and complaint |
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allegation
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a claim made in the complaint by the plaintiff, specifying what the plaintiff expects to prove to obtain a judgment against the defendant |
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counterclaim
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a complaint brought by the defendant against the plaintiff |
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default judgment
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an automatic judgment against a party to a lawsuit who fails to appear in court or to answer a pleading |
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request for production of documents
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a request made by either the plaintiff or defendant in a lawsuit to the opposing side to provide all the documents and other tangible evidence it has in its possession relating to the facts of the case |
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interrogatories
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specific written questions or requests raised by one party to a lawsuit that the opposing party must answer in writing |
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admissions
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factual statements that, unless denied, bind the party at trial |
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stare decisis |
the principle that lower courts must follow precedents set by higher courts |
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motion |
a formal request for the court to take a particular action |
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motion to dismiss |
a request that a court terminate an action because of settlement, voluntary withdrawal, or procedural defect
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motion for summary judgment
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a pretrial request asking the court to enter a judgment when no material facts are in dispute |
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motion in limine |
a pretrial request that certain evidence be excluded from the trial |
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voir dire |
the process of examining potential jurors about their possible interest in the matters presented at trial, their ability to decide the case fairly and without prejudice, and their overall competence to serve as jurors |
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burden of proof |
in a trial, the duty of a party to prove that the facts it claims are true |
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preponderance of evidence
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evidence supporting the jury's decision that is of greater weight than the evidence against it |
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flat fee |
a fee arrangement in which the attorney agrees to handle the case from start to finish for a specified amount |
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phased fee
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a fee arrangement in which the attorney agrees to handle each phase of litigation for a specified fee |
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breach of contract |
the failure, without legal excuse, to fulfill a contractual promise |
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good faith |
the manner of handling claims that requires an insurer to give consideration to the insured's interests that is at least equal to the consideration it gives its own interests |
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bad-faith claim |
a claim that implies or involves actual or constructive fraud, a design to mislead or deceive another, or a neglect or refusal to fulfill some good-faith duty or some contractual good-faith obligation |
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defendant
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the party in a lawsuit against whom a complaint is filed |
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plaintiff
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the person or entity who files a lawsuit and is named as a party |
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contractual damages |
the amounts payable under the contract according to the terms of the contract |
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consequential damages
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a payment awarded by a court to indemnify an injured party for losses that result indirectly from a wrong such as a breach of contract or a tort |
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statute of limitations |
a statute that requires a plaintiff to file a lawsuit within a specific time period after the cause of action has accrued, which is often when the injury occurred or was discovered |
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summary judgment
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a judgment granted by the court when it determines that no factual issue exists |
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ex parte contacts
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contacts in which only one party is heard |
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fraud |
an intentional misrepresentation resulting in harm to a person or organization
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reservation of rights letter |
an insurer's letter that specifies coverage issues and informs the insured that the insurer is handling a claim with the understand that the insurer may later deny coverage should the facts warrant it |
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waiver
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the intentional relinquishment of a known right
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estoppel |
a legal principle that prohibits a party from asserting a claim or right that is inconsistent with that party's past statement or conduct on which another party has detrimentally relied |
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nonwaiver agreement
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a signed agreement indicating that during the course of investigation, neither the insurer nor the insured waives rights under the policy |
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subrogation
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the process by which an insurer can, after is has paid a loss under the policy, recover the amount paid from any party (other than the insured) who caused the loss or is otherwise legally liable for the loss |
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legal liability
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the legally enforceable obligation of a person or an organization to pay a sum of money (called damages) to another person or organization |
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statutory law |
the formal laws, or statutes, enacted by federal, state, or local legislative bodies |
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negligence |
the failure to exercise the degree of care that a reasonable person in a similar situation would exercise to avoid harming others |
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contributory negligence |
a common-law principle that prevents a person who has been harmed from recovering damages if that person's own negligence contributed in any way to the harm |
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comparative negligence
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a common-law principle that requires both parties to a loss to share the financial burden of the bodily injury or property damage according to their respective degrees of fault |
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direct loss
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a reduction in the value of property that results directly and often immediately from damage to that property |
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indirect loss
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a loss that arises as a result of damage to property, other than the direct loss to the property
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pro rata contribution |
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insurable interest
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an interest in the subject of an insurance policy that is not unduly remote and that would cause the interested party to suffer financial loss if an insured event occurred |
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compensatory damages
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a payment awarded by a court to reimburse a victim for actual harm |
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special damages |
a form of compensatory damages that awards a sum of money for specific, identifiable expenses associated with the injured person's loss, such as medical expenses or lost wages |
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general damages
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a monetary award to compensate a victim for losses, such as pain and suffering, that does not involve specific, measurable expenses |
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punitive damages (exemplary damages)
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a payment awarded by a court to punish a defendant for a reckless, malicious, or deceitful act to deter similar conduct; the award need not bear any relation to a party's actual damages |
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coinsurance clause
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a clause that requires the insured to carry insurance equal to at least a specified percentage of the insured property's value |
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alternative dispute resolution (ADR)
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procedures to help settle disputes without litigation, including arbitration, mediation, and negotiation |
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mediation |
an alternative dispute resolution (ADR) method by which disputing parties use a neutral outside party to examine the issues and develop a mutually agreeable settlement |
