Chapter 6 CPCU 520 exam with correct responses
Which |one |of |the |following |statements |is |correct |with |regard |to |the |various |users |of |claim |
information? |- |correct |answer |-Individual |underwriters |are |interested |in |claim |information |for |the |
specific |accounts |they |have |underwritten.
Which |one |of |the |following |statements |is |true |concerning |claim |information |users? |- |correct |answer |-
Producers |must |have |policyholder |loss |information |to |prepare |renewal |policies |properly.
In |the |claim |function, |supporting |the |insurer's |profit |goal |is |accomplished |through |- |correct |answer |-
Controlling |expenses.
Which |one |of |the |following |statements |is |correct |regarding |the |claim |function |of |an |insurer? |- |correct
|answer |-The |claim |function |helps |insurers |achieve |underwriting |profit |through |control |of |expenses.
Most |insurers |give |some |producers |the |authority |to |pay |claims |up |to |a |certain |amount. |In |this |role, |
producers |function |much |like |- |correct |answer |-An |inside |claim |representative.
People |who |handle |claims |may |be |staff |claim |representatives, |independent |adjusters, |employees |of |
third-party |administrators, |or |- |correct |answer |-Producers |who |sell |policies |to |insureds.
People |who |handle |claims |fall |into |a |number |of |categories. |Those |who |handle |claims, |keep |claim |
records, |and |perform |statistical |analysis |on |behalf |of |self-insureds |are |called |- |correct |answer |-Third-
party |administrators.
An |employee |of |an |insurance |company |who |performs |some |or |all |of |the |insurer's |claim-handling |
activities |is |called |- |correct |answer |-A |staff |claim |representative.
Which |one |of |the |following |statements |regarding |authority |levels |is |true |- |correct |answer |-Claim |
information |systems |might |allow |different |authority |levels |for |different |types |of |employees.
, State |insurance |regulators |conduct |claim |audits |to |ensure |- |correct |answer |-Understanding |of |
reserving |practices.
Claim |audits |are |a |review |of |claim |files |to |ensure |that |claims |are |being |handled |properly, |and |- |
correct |answer |-Can |be |conducted |by |an |individual |other |than |an |insurer's |internal |personnel.
Soon |after |a |loss |has |been |assigned |and |initial |reserves |have |been |established, |a |claim |representative
|contacts |the |insured |or |the |insured's |representative. |Which |one |of |the |following |statements |is |
correct |with |respect |to |that |contact? |- |correct |answer |-Claim |representatives |must |be |careful |not |to |
give |the |impression |that |a |claim |will |be |paid |if |potential |grounds |exist |to |deny |the |claim.
An |important |aspect |of |acknowledging |a |claimant's |liability |claim, |upon |first |contact, |is |- |correct |
answer |-To |try |to |obtain |information |on |the |nature |and |extent |of |the |injury.
Claim |representatives |are |responsible |for |determining |the |cause |of |loss, |liability, |and |the |loss |
amount. |Which |one |of |the |following |statements |is |correct |with |respect |to |this |process? |- |correct |
answer |-The |claim |representative |reviews |all |component |parts |of |the |policy |and |applies |them |to |the |
facts |of |the |case.
The |question |"Is |the |location |of |the |loss |covered?" |is |a |part |of |the |framework |for |coverage |analysis |
because |the |location |where |the |loss |occurred |must |be |within |the |policy's |territorial |limits. |The |PAP |
includes |which |one |of |the |following |locations |in |the |definition |of |policy |territory? |- |correct |answer |-
Puerto |Rico
Buddy's |store |is |damaged |in |a |fire. |He |suffers |loss |of |his |merchandise |as |well |as |loss |of |income |while |
he |replenishes |his |stock. |His |direct |loss |is |- |correct |answer |-The |loss |of |his |merchandise |and |damage |
to |the |store.
In |handling |a |property |claim |under |Special |Form |Coverage, |a |claim |representative |should |gather |facts
|about |the |cause |of |loss |and |then |- |correct |answer |-Determine |if |the |cause |of |loss |is |excluded |in |the |
Special |Form |Coverage.
Antonia |and |Philip |have |their |house |insured |with |Durham |Insurance |under |an |HO-3 |homeowner's |
policy. |Philip |is |the |named |insured |and |there |is |no |mortgagee |shown |on |the |policy. |During |a |storm, |a
|lightning |strike |results |in |a |kitchen |fire |and |high |winds |causes |a |tree |to |fall |on |the |roof, |leaving |a |
Which |one |of |the |following |statements |is |correct |with |regard |to |the |various |users |of |claim |
information? |- |correct |answer |-Individual |underwriters |are |interested |in |claim |information |for |the |
specific |accounts |they |have |underwritten.
Which |one |of |the |following |statements |is |true |concerning |claim |information |users? |- |correct |answer |-
Producers |must |have |policyholder |loss |information |to |prepare |renewal |policies |properly.
In |the |claim |function, |supporting |the |insurer's |profit |goal |is |accomplished |through |- |correct |answer |-
Controlling |expenses.
Which |one |of |the |following |statements |is |correct |regarding |the |claim |function |of |an |insurer? |- |correct
|answer |-The |claim |function |helps |insurers |achieve |underwriting |profit |through |control |of |expenses.
Most |insurers |give |some |producers |the |authority |to |pay |claims |up |to |a |certain |amount. |In |this |role, |
producers |function |much |like |- |correct |answer |-An |inside |claim |representative.
People |who |handle |claims |may |be |staff |claim |representatives, |independent |adjusters, |employees |of |
third-party |administrators, |or |- |correct |answer |-Producers |who |sell |policies |to |insureds.
People |who |handle |claims |fall |into |a |number |of |categories. |Those |who |handle |claims, |keep |claim |
records, |and |perform |statistical |analysis |on |behalf |of |self-insureds |are |called |- |correct |answer |-Third-
party |administrators.
An |employee |of |an |insurance |company |who |performs |some |or |all |of |the |insurer's |claim-handling |
activities |is |called |- |correct |answer |-A |staff |claim |representative.
Which |one |of |the |following |statements |regarding |authority |levels |is |true |- |correct |answer |-Claim |
information |systems |might |allow |different |authority |levels |for |different |types |of |employees.
, State |insurance |regulators |conduct |claim |audits |to |ensure |- |correct |answer |-Understanding |of |
reserving |practices.
Claim |audits |are |a |review |of |claim |files |to |ensure |that |claims |are |being |handled |properly, |and |- |
correct |answer |-Can |be |conducted |by |an |individual |other |than |an |insurer's |internal |personnel.
Soon |after |a |loss |has |been |assigned |and |initial |reserves |have |been |established, |a |claim |representative
|contacts |the |insured |or |the |insured's |representative. |Which |one |of |the |following |statements |is |
correct |with |respect |to |that |contact? |- |correct |answer |-Claim |representatives |must |be |careful |not |to |
give |the |impression |that |a |claim |will |be |paid |if |potential |grounds |exist |to |deny |the |claim.
An |important |aspect |of |acknowledging |a |claimant's |liability |claim, |upon |first |contact, |is |- |correct |
answer |-To |try |to |obtain |information |on |the |nature |and |extent |of |the |injury.
Claim |representatives |are |responsible |for |determining |the |cause |of |loss, |liability, |and |the |loss |
amount. |Which |one |of |the |following |statements |is |correct |with |respect |to |this |process? |- |correct |
answer |-The |claim |representative |reviews |all |component |parts |of |the |policy |and |applies |them |to |the |
facts |of |the |case.
The |question |"Is |the |location |of |the |loss |covered?" |is |a |part |of |the |framework |for |coverage |analysis |
because |the |location |where |the |loss |occurred |must |be |within |the |policy's |territorial |limits. |The |PAP |
includes |which |one |of |the |following |locations |in |the |definition |of |policy |territory? |- |correct |answer |-
Puerto |Rico
Buddy's |store |is |damaged |in |a |fire. |He |suffers |loss |of |his |merchandise |as |well |as |loss |of |income |while |
he |replenishes |his |stock. |His |direct |loss |is |- |correct |answer |-The |loss |of |his |merchandise |and |damage |
to |the |store.
In |handling |a |property |claim |under |Special |Form |Coverage, |a |claim |representative |should |gather |facts
|about |the |cause |of |loss |and |then |- |correct |answer |-Determine |if |the |cause |of |loss |is |excluded |in |the |
Special |Form |Coverage.
Antonia |and |Philip |have |their |house |insured |with |Durham |Insurance |under |an |HO-3 |homeowner's |
policy. |Philip |is |the |named |insured |and |there |is |no |mortgagee |shown |on |the |policy. |During |a |storm, |a
|lightning |strike |results |in |a |kitchen |fire |and |high |winds |causes |a |tree |to |fall |on |the |roof, |leaving |a |
