AIC 300 LATEST STUDYS ANSWERS AND QUESTIONS
SET A+
✔✔What qualities do effective statements exhibit? - ✔✔• Coherence—The statement
follows a logical sequence • Completeness—The statement is thorough • Objectivity—
The statement contains facts relevant to the loss expressed in the interviewee's own
words
✔✔Jenny is in an automobile accident and files a claim. What information should the
claims representative consider when investigating the accident scene? - ✔✔Tire tracks,
curves in the road, and objects or conditions that may interfere with a driver's view or
cause an accident (such as a pothole)
✔✔Freja files a workers compensation claim. What type of an investigation should the
claims representative conduct and why? - ✔✔Medical investigation. This helps the
claims representative determine the costs of medical treatment, the expected duration
of treatment and disability, the need for rehabilitation, and the suitability of medical care
for the type of injuries the claimant suffered.
✔✔While working on an auto collision claim, Lois, a claims representative, adds a
remark regarding gender in the claims file. Is this remark appropriate? - ✔✔Remarks
regarding the gender of claimants or insureds are not appropriate for inclusion in a
claims file.
✔✔Linnea, a new claims representative, wants to know what elements should be
reflected in claims file status notes? What would you tell her? - ✔✔• Clear, concise, and
accurate information • Timely claims handling • A fair and balanced investigation that
considers the insured's and insurer's interests • Objective comments about the insurer,
insured, or other parties associated with the claim • A thorough good-faith investigation
✔✔Why is establishing and maintaining adequate reserves important? - ✔✔If a claims
representative doesn't set accurate case reserves, it could affect the financial health of
the insurer for which he or she works. In extreme cases, inaccurate reserving could
cause insolvency.
, ✔✔What is the formula method of setting claim reserves? - ✔✔With the formula method
of setting claim reserves, a formula for setting a reserve is determined by the insurer
and is automatically created for the claims rep based on the facts of a claim.
✔✔What is stairstepping a reserve? - ✔✔A claims rep may set a modest initial reserve
but then raise the reserve by a few thousand dollars to issue payments. Later, the
reserve is increased again when more bills arrive.
✔✔Who does an insurance policy typically cover? - ✔✔Some policies cover only
insureds named or listed in the policy. However, most policies define "insured" to cover
additional persons, such as family members of the named insured who reside in the
home
✔✔What should Kolby, a claims representative, do to determine whether a cause of
loss is covered? - ✔✔Kolby should thoroughly investigate all the facts concerning the
loss and apply them to the language in all the policy provisions. He must also carefully
read the exclusions to find possible coverage exceptions and analyze policy definitions.
✔✔Eduardo is the insured in a liability claim. What are the damages for which he may
be liable? - ✔✔Punitive and compensatory damages. Punitive damages punish a
wrongdoer for a reckless, malicious, or deceitful act with the purpose of deterring similar
conduct. Compensatory damages include special damages and general damages.
✔✔What must a claims representative do before making any payments? - ✔✔The
claims representative must verify all the policy limits applicable to a loss before making
any payments to ensure that payment falls within the available limits of coverage.
✔✔How can claim payments be made? - ✔✔Check, bank draft, or electronic transfer of
funds
✔✔What are some issues claims personnel must be aware of when issuing claim
payments? - ✔✔When issuing claim payments, claims personnel must ensure that the
proper parties are being paid. Many other parties, such as mortgagees on homes and
loss payees on autos and personal property, can have a financial interest in property.
Claims reps must also check various databases to ensure that the claim payment
complies with federal and state laws. Insurers and other claims payors must also be
aware of state child-support enforcement initiatives. And claims reps handling workers
compensation claims and third-party bodily injury claims must be aware of the Medicare
Secondary Payer Program and how it can affect claim payments.
✔✔What are two negotiation techniques that Magnus, a claims representative, can use
to negotiate with any party? - ✔✔• Principle of yes—Magnus should begin negotiations
with a question that will generate a "yes" answer, which increases the likelihood of
SET A+
✔✔What qualities do effective statements exhibit? - ✔✔• Coherence—The statement
follows a logical sequence • Completeness—The statement is thorough • Objectivity—
The statement contains facts relevant to the loss expressed in the interviewee's own
words
✔✔Jenny is in an automobile accident and files a claim. What information should the
claims representative consider when investigating the accident scene? - ✔✔Tire tracks,
curves in the road, and objects or conditions that may interfere with a driver's view or
cause an accident (such as a pothole)
✔✔Freja files a workers compensation claim. What type of an investigation should the
claims representative conduct and why? - ✔✔Medical investigation. This helps the
claims representative determine the costs of medical treatment, the expected duration
of treatment and disability, the need for rehabilitation, and the suitability of medical care
for the type of injuries the claimant suffered.
✔✔While working on an auto collision claim, Lois, a claims representative, adds a
remark regarding gender in the claims file. Is this remark appropriate? - ✔✔Remarks
regarding the gender of claimants or insureds are not appropriate for inclusion in a
claims file.
✔✔Linnea, a new claims representative, wants to know what elements should be
reflected in claims file status notes? What would you tell her? - ✔✔• Clear, concise, and
accurate information • Timely claims handling • A fair and balanced investigation that
considers the insured's and insurer's interests • Objective comments about the insurer,
insured, or other parties associated with the claim • A thorough good-faith investigation
✔✔Why is establishing and maintaining adequate reserves important? - ✔✔If a claims
representative doesn't set accurate case reserves, it could affect the financial health of
the insurer for which he or she works. In extreme cases, inaccurate reserving could
cause insolvency.
, ✔✔What is the formula method of setting claim reserves? - ✔✔With the formula method
of setting claim reserves, a formula for setting a reserve is determined by the insurer
and is automatically created for the claims rep based on the facts of a claim.
✔✔What is stairstepping a reserve? - ✔✔A claims rep may set a modest initial reserve
but then raise the reserve by a few thousand dollars to issue payments. Later, the
reserve is increased again when more bills arrive.
✔✔Who does an insurance policy typically cover? - ✔✔Some policies cover only
insureds named or listed in the policy. However, most policies define "insured" to cover
additional persons, such as family members of the named insured who reside in the
home
✔✔What should Kolby, a claims representative, do to determine whether a cause of
loss is covered? - ✔✔Kolby should thoroughly investigate all the facts concerning the
loss and apply them to the language in all the policy provisions. He must also carefully
read the exclusions to find possible coverage exceptions and analyze policy definitions.
✔✔Eduardo is the insured in a liability claim. What are the damages for which he may
be liable? - ✔✔Punitive and compensatory damages. Punitive damages punish a
wrongdoer for a reckless, malicious, or deceitful act with the purpose of deterring similar
conduct. Compensatory damages include special damages and general damages.
✔✔What must a claims representative do before making any payments? - ✔✔The
claims representative must verify all the policy limits applicable to a loss before making
any payments to ensure that payment falls within the available limits of coverage.
✔✔How can claim payments be made? - ✔✔Check, bank draft, or electronic transfer of
funds
✔✔What are some issues claims personnel must be aware of when issuing claim
payments? - ✔✔When issuing claim payments, claims personnel must ensure that the
proper parties are being paid. Many other parties, such as mortgagees on homes and
loss payees on autos and personal property, can have a financial interest in property.
Claims reps must also check various databases to ensure that the claim payment
complies with federal and state laws. Insurers and other claims payors must also be
aware of state child-support enforcement initiatives. And claims reps handling workers
compensation claims and third-party bodily injury claims must be aware of the Medicare
Secondary Payer Program and how it can affect claim payments.
✔✔What are two negotiation techniques that Magnus, a claims representative, can use
to negotiate with any party? - ✔✔• Principle of yes—Magnus should begin negotiations
with a question that will generate a "yes" answer, which increases the likelihood of
