AIC 300 EXAM QUESTIONS AND
ANSWERS 2025
first party insurance - ANSWERinsurer makes payment for covered losses directly to
the policyholder (first party)
third-party insurance - ANSWERinsurer makes payments on behalf of the policyholder
to a claimant (third party)
third party administrators (TPAs) - ANSWER- an organization that provides
administrative services associated with risk financing and insurance (claims, records,
analysis, etc)
- self insured businesses can handle their own claims or hire a TPA
- P&C insurers have subsidiaries that serve as a TPA
staff claims representatives - ANSWERa person responsible for investigating,
evaluating, and settling claims (ex: adjusters)
independent adjusters - ANSWER- specialized claims + field work
- if insurer cant afford claims offices in every state
- some are self employed, some work for adjusting firms
producers - ANSWER- any kinds of insurance personnel who place insurance and
surety business with insurers and who represent either insurers, insureds, or both
- ex: agents, brokers, sales reps
public adjusters - ANSWER- outside organization or person hired by an insured to
represent the insured in a claim in exchange for a fee
- if insured is not happy with settlement or it is a complex claim
types of staff claims representatives - ANSWERinside: exclusively from insurer's office
field: outside, both in and out of office, handle claims with tasks like investigating scene
of loss, meeting with insureds, etc
line underwriters - ANSWERwork directly with insurance producers and applicants to
evaluate new submissions & renewals
staff underwriters - ANSWERwork with line underwriters to coordinate decisions about
products, pricing, and guidelines
premium audit - ANSWERmethodical examinations of a policyholder's operations,
records, and books of account to determine the actual exposure units and premium for
insurance coverages already provided
, why should claim reps be careful with what they say on claims communication? -
ANSWERclaims investigation activities can later be used as evidence in legal
proceedings, any written claims communication can be subpoenaed
loss ratio - ANSWERlosses & los adjustment expenses / earned premium
measures the performance of claims & uw departments
loss adjustment expenses (LAE) - ANSWERthe expense that an insurer incurs to
investigate, defend, and settle claims according to the terms specified in the policy
short term solution to reduce LAE - ANSWERreduce expenses by offering settlement
payments instead of paying for investigation and legal defense
3 Quality Measures of a Claims Dept - ANSWER- best practices
- claims audits
- customer satisfaction data
Quantitative vs Qualitative Audit Factors - ANSWERquantitative: all come from # data
(ex: timeliness of reports, number of files opened monthly, avg claims settlement value)
qualitative: based on judgement (realistic reserving, proper releases taken, correct
coverage evaluation, good negotiation skills)
Claims Acknowledgement - ANSWERclaims process begins when an insurer receives a
claim. this advises that the claim was received
Activities in the claims handling process - ANSWER1. Acknowledge a claim and
assigning it to a claims rep
2. Identifying the policy
3. Contacting the insured of the insured's representative
4. Investigating and documenting the claim
5. Determining the cause of loss and the loss amount
6. Concluding the claim
First notice of loss (FNOL) - ANSWERthe initial report notifying the insurer of a claim
some states have time requirement for assignment/acknowledgement of claims
Reservation of rights letter - ANSWERany significant doubt over coverage
report-only claims - ANSWEREE fell but no injury yet - just monitoring the person for
anything that may develop
critical aspects of contacting the insured - ANSWER- Timing and method of contact
ANSWERS 2025
first party insurance - ANSWERinsurer makes payment for covered losses directly to
the policyholder (first party)
third-party insurance - ANSWERinsurer makes payments on behalf of the policyholder
to a claimant (third party)
third party administrators (TPAs) - ANSWER- an organization that provides
administrative services associated with risk financing and insurance (claims, records,
analysis, etc)
- self insured businesses can handle their own claims or hire a TPA
- P&C insurers have subsidiaries that serve as a TPA
staff claims representatives - ANSWERa person responsible for investigating,
evaluating, and settling claims (ex: adjusters)
independent adjusters - ANSWER- specialized claims + field work
- if insurer cant afford claims offices in every state
- some are self employed, some work for adjusting firms
producers - ANSWER- any kinds of insurance personnel who place insurance and
surety business with insurers and who represent either insurers, insureds, or both
- ex: agents, brokers, sales reps
public adjusters - ANSWER- outside organization or person hired by an insured to
represent the insured in a claim in exchange for a fee
- if insured is not happy with settlement or it is a complex claim
types of staff claims representatives - ANSWERinside: exclusively from insurer's office
field: outside, both in and out of office, handle claims with tasks like investigating scene
of loss, meeting with insureds, etc
line underwriters - ANSWERwork directly with insurance producers and applicants to
evaluate new submissions & renewals
staff underwriters - ANSWERwork with line underwriters to coordinate decisions about
products, pricing, and guidelines
premium audit - ANSWERmethodical examinations of a policyholder's operations,
records, and books of account to determine the actual exposure units and premium for
insurance coverages already provided
, why should claim reps be careful with what they say on claims communication? -
ANSWERclaims investigation activities can later be used as evidence in legal
proceedings, any written claims communication can be subpoenaed
loss ratio - ANSWERlosses & los adjustment expenses / earned premium
measures the performance of claims & uw departments
loss adjustment expenses (LAE) - ANSWERthe expense that an insurer incurs to
investigate, defend, and settle claims according to the terms specified in the policy
short term solution to reduce LAE - ANSWERreduce expenses by offering settlement
payments instead of paying for investigation and legal defense
3 Quality Measures of a Claims Dept - ANSWER- best practices
- claims audits
- customer satisfaction data
Quantitative vs Qualitative Audit Factors - ANSWERquantitative: all come from # data
(ex: timeliness of reports, number of files opened monthly, avg claims settlement value)
qualitative: based on judgement (realistic reserving, proper releases taken, correct
coverage evaluation, good negotiation skills)
Claims Acknowledgement - ANSWERclaims process begins when an insurer receives a
claim. this advises that the claim was received
Activities in the claims handling process - ANSWER1. Acknowledge a claim and
assigning it to a claims rep
2. Identifying the policy
3. Contacting the insured of the insured's representative
4. Investigating and documenting the claim
5. Determining the cause of loss and the loss amount
6. Concluding the claim
First notice of loss (FNOL) - ANSWERthe initial report notifying the insurer of a claim
some states have time requirement for assignment/acknowledgement of claims
Reservation of rights letter - ANSWERany significant doubt over coverage
report-only claims - ANSWEREE fell but no injury yet - just monitoring the person for
anything that may develop
critical aspects of contacting the insured - ANSWER- Timing and method of contact
