Claims Adjuster Glossary of Terms
[Complete Study] 100% Correct
Accumulated Depreciation *Ans*✨The total decrease in an item's value over a period of time.
Formula: (Annual Depreciation x Number of years used)
Actual Cash Value (ACV) *Ans*✨A valuation method used by insurers to reflect an item's current
market value right before being damaged or destroyed. Formula: (Replacement cost - Accumulated
Depreciation)
Adhesion *Ans*✨One of the characteristics of an insurance contract. Means that one party (the
insurer) sets the terms, and the other (the insured) can 'take it or leave it.'
Adjusted Gross Revenue (Crop Insurance) *Ans*✨Narrowest (and least expensive) form of Crop
Revenue Insurance. Insures farm revenue as a whole instead of individual crops. Guarantees a
percentage of the insured farm's average revenue.
Adjuster *Ans*✨An agent who, for compensation, processes insurance claims. Can represent either
the insured or the insurer.
Adjuster - Emergency *Ans*✨Adjusters who are temporarily licensed by the insurance commissioner
to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in
a short period of time.
Adjuster-Independent *Ans*✨Self-employed adjusters who contract with multiple insurers at the
same time. Paid on a commission or fee-plus-expenses basis for each claim. Also called:Fee Adjuster,
Bureau Adjuster
Adjuster-Public *Ans*✨An adjuster who is hired to represent the claimant and help determine a fair
indemnification. Usually specializes in appraisals and negotiation. Paid commision, usually a percentage
of final settlement.
,Adjuster-Staff *Ans*✨Salaried employee of one insurance company who can work locally, regionally,
or nationally. Also called: Company Adjuster
Advance Payment Settlement *Ans*✨A settlement option that lets the insurer offer some financial
relief to the claimant before the claim has been fully settled. The insurer makes advance payments to
the claimant, which are then subtracted from the final settlement amount. Often used when a claimant
suffers bodily injury and is unable to work.
Agency Authority *Ans*✨The Agent's authority to act on behalf of someone else, usually an insurer.
This authority is derived from the agent's contract with the insurer.
Agency Authority - apparent *Ans*✨Authority that an agent possesses based on the appearance of
representing an insurer.
Agency Authority - express *Ans*✨Authority that is expressly given to the agent in writing. Allows
agent to act on behalf of the principal.
Agency Authority - implied *Ans*✨Authority that an agent possesses by implication of his behavior,
regardless of whether this authority is expressly granted in writing.
Agent *Ans*✨Someone who has received authority from an insurer to sell or service insurance
policies.
Aggregate Limit *Ans*✨A type of policy limit found in some health, liability, and property damage
policies. It represents the total amount the insurer will pay for all losses (as opposed to an occurrence
limit, which denotes the total amount the insurer will pay per occurrence).
Agreement *Ans*✨One of the four requirements of a legally binding contract. All parties involved
must agree to the terms of the contract. Can also refer to a binder, which is the preliminary substance of
a contract.
Agricultural Producer *Ans*✨A business that grows, harvests, and sells crops for profit.
,Aleatory *Ans*✨A characteristic of insurance contracts. Aleatory means "depending on an unknown
future
event." An insurance contract will only pay IF and WHEN covered damages occur. Neither party
knows how much the contract will end up paying when they enter into the contract.
Annual Depreciation *Ans*✨An item's Replacement cost divided by the number of years in its
expected lifespan.
Answer *Ans*✨In liability cases, the defendant's response to a complaint. There are three possible
answers: 1)
accept complaint and pay for damages, 2) deny the complaint, or 3) accept the complaint with a
right to insert evidence into the case.
Appraisal *Ans*✨A negotiation method which allows the claimant and the insurer each to select an
appraiser.
The two appraisers in turn select an Umpire. The appraisers then work together to determine a
settlement amount. If they cannot agree, the Umpire steps in. Agreement by any two of the
three is binding.
Arbitration *Ans*✨A negotiation method in which the opposing parties each submit their evidence to
a mutuallyagreed-
upon and neutral third party, called an arbitrator. The arbitrator reviews the positions of
each opposing side, and makes a final and legally binding decision.
Arbitrator *Ans*✨The mutually-agreed-upon and neutral third party in an arbitration who reviews the
positions of
each opposing side, and makes a final and legally binding decision.
Auto Policy *Ans*✨Insurance policy designed to protect the policyholder while owning, occupying, or
operating a
vehicle. Usually combines liability coverage and property coverage into one policy.
, Automobile *Ans*✨In Insurance policies, Automobile generally means any vehicle designed for use on
public
roads.
Automobile No-fault Laws *Ans*✨Laws in effect in some states that require any owner of a vehicle to
purchase no-fault insurance;
that is, insurance that indemnifies the insured regardless of who was at fault in an accident. Nofault
laws also restrict the insured's right to sue the at-fault party.
Aviation *Ans*✨Aviation insurance combines hull insurance for the aircraft and liability insurance for
any
damage to others' property or to people who are not passengers.
Bailee *Ans*✨An individual or company that receives the property of someone else for a special
purpose, and
returns the product after use.
BAP *Ans*✨The Business Auto Policy provides property damage and liability insurance for
automobiles
used by a business.
BI *Ans*✨(Bodily Injury): Physical damage to someone's person. Liability insurance covers bodily
injury
that the insured might cause to another person through negligence.
Binder *Ans*✨A temporary contract provided by an insurer that ensures coverage until the complete,
permanent policy is issued.
Body Language *Ans*✨The signals we give through posture, behaviour, apparel, etc., which are
involved in
[Complete Study] 100% Correct
Accumulated Depreciation *Ans*✨The total decrease in an item's value over a period of time.
Formula: (Annual Depreciation x Number of years used)
Actual Cash Value (ACV) *Ans*✨A valuation method used by insurers to reflect an item's current
market value right before being damaged or destroyed. Formula: (Replacement cost - Accumulated
Depreciation)
Adhesion *Ans*✨One of the characteristics of an insurance contract. Means that one party (the
insurer) sets the terms, and the other (the insured) can 'take it or leave it.'
Adjusted Gross Revenue (Crop Insurance) *Ans*✨Narrowest (and least expensive) form of Crop
Revenue Insurance. Insures farm revenue as a whole instead of individual crops. Guarantees a
percentage of the insured farm's average revenue.
Adjuster *Ans*✨An agent who, for compensation, processes insurance claims. Can represent either
the insured or the insurer.
Adjuster - Emergency *Ans*✨Adjusters who are temporarily licensed by the insurance commissioner
to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in
a short period of time.
Adjuster-Independent *Ans*✨Self-employed adjusters who contract with multiple insurers at the
same time. Paid on a commission or fee-plus-expenses basis for each claim. Also called:Fee Adjuster,
Bureau Adjuster
Adjuster-Public *Ans*✨An adjuster who is hired to represent the claimant and help determine a fair
indemnification. Usually specializes in appraisals and negotiation. Paid commision, usually a percentage
of final settlement.
,Adjuster-Staff *Ans*✨Salaried employee of one insurance company who can work locally, regionally,
or nationally. Also called: Company Adjuster
Advance Payment Settlement *Ans*✨A settlement option that lets the insurer offer some financial
relief to the claimant before the claim has been fully settled. The insurer makes advance payments to
the claimant, which are then subtracted from the final settlement amount. Often used when a claimant
suffers bodily injury and is unable to work.
Agency Authority *Ans*✨The Agent's authority to act on behalf of someone else, usually an insurer.
This authority is derived from the agent's contract with the insurer.
Agency Authority - apparent *Ans*✨Authority that an agent possesses based on the appearance of
representing an insurer.
Agency Authority - express *Ans*✨Authority that is expressly given to the agent in writing. Allows
agent to act on behalf of the principal.
Agency Authority - implied *Ans*✨Authority that an agent possesses by implication of his behavior,
regardless of whether this authority is expressly granted in writing.
Agent *Ans*✨Someone who has received authority from an insurer to sell or service insurance
policies.
Aggregate Limit *Ans*✨A type of policy limit found in some health, liability, and property damage
policies. It represents the total amount the insurer will pay for all losses (as opposed to an occurrence
limit, which denotes the total amount the insurer will pay per occurrence).
Agreement *Ans*✨One of the four requirements of a legally binding contract. All parties involved
must agree to the terms of the contract. Can also refer to a binder, which is the preliminary substance of
a contract.
Agricultural Producer *Ans*✨A business that grows, harvests, and sells crops for profit.
,Aleatory *Ans*✨A characteristic of insurance contracts. Aleatory means "depending on an unknown
future
event." An insurance contract will only pay IF and WHEN covered damages occur. Neither party
knows how much the contract will end up paying when they enter into the contract.
Annual Depreciation *Ans*✨An item's Replacement cost divided by the number of years in its
expected lifespan.
Answer *Ans*✨In liability cases, the defendant's response to a complaint. There are three possible
answers: 1)
accept complaint and pay for damages, 2) deny the complaint, or 3) accept the complaint with a
right to insert evidence into the case.
Appraisal *Ans*✨A negotiation method which allows the claimant and the insurer each to select an
appraiser.
The two appraisers in turn select an Umpire. The appraisers then work together to determine a
settlement amount. If they cannot agree, the Umpire steps in. Agreement by any two of the
three is binding.
Arbitration *Ans*✨A negotiation method in which the opposing parties each submit their evidence to
a mutuallyagreed-
upon and neutral third party, called an arbitrator. The arbitrator reviews the positions of
each opposing side, and makes a final and legally binding decision.
Arbitrator *Ans*✨The mutually-agreed-upon and neutral third party in an arbitration who reviews the
positions of
each opposing side, and makes a final and legally binding decision.
Auto Policy *Ans*✨Insurance policy designed to protect the policyholder while owning, occupying, or
operating a
vehicle. Usually combines liability coverage and property coverage into one policy.
, Automobile *Ans*✨In Insurance policies, Automobile generally means any vehicle designed for use on
public
roads.
Automobile No-fault Laws *Ans*✨Laws in effect in some states that require any owner of a vehicle to
purchase no-fault insurance;
that is, insurance that indemnifies the insured regardless of who was at fault in an accident. Nofault
laws also restrict the insured's right to sue the at-fault party.
Aviation *Ans*✨Aviation insurance combines hull insurance for the aircraft and liability insurance for
any
damage to others' property or to people who are not passengers.
Bailee *Ans*✨An individual or company that receives the property of someone else for a special
purpose, and
returns the product after use.
BAP *Ans*✨The Business Auto Policy provides property damage and liability insurance for
automobiles
used by a business.
BI *Ans*✨(Bodily Injury): Physical damage to someone's person. Liability insurance covers bodily
injury
that the insured might cause to another person through negligence.
Binder *Ans*✨A temporary contract provided by an insurer that ensures coverage until the complete,
permanent policy is issued.
Body Language *Ans*✨The signals we give through posture, behaviour, apparel, etc., which are
involved in
