Claims Handling and Adjustment Practices
What this domain tests
This domain tests the claim lifecycle: notice, investigation, coverage analysis, damage evaluation, negotiation, settlement, and documentation. It also tests the public adjuster's written contract, communication duties, appraisal, and Georgia's bad-faith rules.
Core rules
- The insured must give prompt notice, protect the property from further damage, cooperate, submit a proof of loss when required, and allow examination under oath if the policy requires it.
- The adjuster should acknowledge the claim, inspect promptly, photograph and measure the loss, obtain estimates and records, compare the facts to the policy, and issue a written coverage position. Document every conversation and decision.
- Georgia's public adjuster contract rules require a written contract signed by the insured, specified disclosures, and a three-business-day cancellation right. The adjuster should not begin work without a signed contract.
- Damage evaluation should separate covered scope from noncovered work, show quantities and unit costs, identify depreciation, overhead and profit, code items, and matching issues. Settlement should reconcile the carrier's scope with the adjuster's scope rather than simply accept either estimate.
- Appraisal resolves disputes about the amount of loss, not disputes about whether coverage exists. A reservation-of-rights letter preserves the insurer's coverage defenses while the investigation continues.
- Georgia's bad-faith statute, O.C.G.A. § 33-4-6, can impose a 50 percent penalty and attorney fees when an insurer refuses to pay a covered loss within 60 days after a proper demand. Georgia's unfair claims practices law, O.C.G.A. § 33-6-34, also prohibits misrepresentation, unreasonable delay, and failure to investigate.
Worked example
A burst pipe damages a kitchen. The carrier cites a long-term seepage exclusion. The adjuster obtains the plumber's report showing a sudden pipe failure, photographs the cut pipe, and documents the date of loss. Coverage is confirmed. The replacement cost is $40,000, actual cash value is $28,000, and the deductible is $2,000. The initial payment is $26,000. After the insured completes the repair, the adjuster submits invoices and requests the $12,000 recoverable depreciation. The file shows the coverage analysis, scope, photographs, and payment reconciliation.
Traps
Do not sign a proof of loss for the insured, promise a specific settlement, or accept the carrier's scope without an independent inspection. Do not confuse appraisal with a coverage appeal, and do not miss the 60-day bad-faith demand framework when advising on delay.