Iran Loss Adjuster Exam flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Insurable interest

The legal or economic relationship by which the insured benefits from the preservation of the subject matter and suffers measurable loss from its damage; it must exist at inception for life and at the time of loss for indemnity lines.

Proximate cause

The dominant, effective cause of a loss that sets the chain of events in motion without intervention of an independent cause; it determines whether the loss falls within the insured perils.

Subrogation

The insurer's right, after paying a claim, to step into the insured's legal position and recover the loss from the liable third party, limited to the amount actually paid.

Contribution

The principle that where two or more policies cover the same interest against the same peril, each insurer pays its share so that total recovery does not exceed the loss.

Moral hazard

The risk that the existence of insurance changes the insured's behaviour, increasing the likelihood or size of a claim; indicators include over-insurance, late reporting, and financial distress.

Bimeh Markazi Iran

The Central Insurance of Iran, the statutory regulator and supervisor that licenses insurers, approves policy wordings and tariffs, and enforces solvency and reserve requirements.

1937 Insurance Law

The foundational Iranian statute (Qanun-e Bimeh) governing insurance contracts, insurer obligations, and supervision; Article 20 requires payment within one month of complete documentation.

Compulsory motor liability

Mandatory third-party liability cover (bimeh-e masouliyat) for all vehicles in Iran, covering bodily injury and property damage caused to third parties up to statutory limits.

Technical reserves

Statutory reserves insurers must hold, including unearned premium reserve, outstanding claims reserve, and incurred-but-not-reported reserve, to ensure ability to meet future obligations.

Contra proferentem

The rule that ambiguous policy wording is construed against the party who drafted it, usually the insurer; clear exclusion wording, however, is enforced as written.

Condition precedent

A policy term that must be satisfied before the insurer's liability arises, such as prompt notification or submission of proof of loss; breach may entitle the insurer to deny the claim.

Average clause

A policy provision reducing the claim where the sum insured is less than the value at risk, applying the ratio sum insured divided by value at risk to the loss.

Warranty in insurance

A promise by the insured that a specified state of affairs exists or will be maintained; strict breach may allow the insurer to avoid liability from the date of breach.

Adjuster independence

The professional duty to act impartially between insurer and insured, disclose conflicts of interest, and decline instructions where objectivity cannot be maintained.

Contemporaneous notes

Records made at the time of inspection or interview, stating date, time, location, and source; they are the primary evidence supporting the adjuster's conclusions.

Confidentiality duty

The adjuster's obligation to protect claim information and disclose it only to the instructing insurer and authorised parties, except where legally compelled.

Reinstatement value

The cost of replacing or repairing damaged property with new materials of like kind and quality without deduction for depreciation; the policy wording determines whether it applies.

Business interruption

Cover for loss of gross profit or revenue following insured physical damage, calculated over the indemnity period with trend and increased cost of working adjustments.

Salvage

The residual value of damaged property after a loss; the insurer is entitled to salvage proceeds after paying a total loss, and the value is deducted from the claim.

Betterment deduction

The reduction applied when new parts improve an older vehicle or property beyond its pre-loss condition; the insured bears the difference between new and depreciated value.

Diyeh

The blood money schedule set annually by the Iranian judiciary, used to compensate bodily injury and death in third-party motor liability claims, supplemented by proven medical costs.

Total loss (motor)

A vehicle is a total loss where repair cost exceeds market value or a stated percentage; settlement is on market value less salvage and deductible.

Own-damage cover

Voluntary motor insurance (bimeh-e badaneh) paying for damage to the insured vehicle, subject to deductible, depreciation, and the agreed sum insured.

Suicide exclusion

A life policy clause excluding payment where the insured dies by suicide within the first one or two years; after that period the sum insured is payable.

Incontestability period

A period, commonly two years, after which the insurer cannot avoid a life policy for non-disclosure or misrepresentation at proposal stage.

Waiting period

The initial period after policy inception during which specified illnesses or maternity are not covered; accidents are usually covered from inception.

Medical necessity

The requirement that treatment be appropriate, prescribed by a licensed practitioner, and consistent with the diagnosis before health claim reimbursement is approved.

CAR and EAR cover

Contractors' and Erection All Risks policies covering physical damage to works, plant, and third-party liability during construction and the maintenance period.

Professional indemnity

Cover for negligent acts, errors, or omissions in professional services, subject to notification within the policy period or an extended reporting period.

Fidelity guarantee

Cover for loss of money or property caused by employee dishonesty; the adjuster must establish the dishonest act and quantify the loss.

Fraud red flags

Indicators such as over-insurance, recent policy inception, financial distress, staged accidents, inflated estimates, and refusal to provide original documents.

Final adjuster report

The report stating cause of loss, coverage analysis, quantum calculation, deductions for excess, depreciation, and salvage, and the recommended settlement amount.