NC Claims Adjuster flashcards
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32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Indemnity principle
- Insurance restores the insured to the pre-loss financial position without profit; it prevents overinsurance and moral hazard by limiting recovery to actual loss.
- Insurable interest
- A person must have a financial stake in property at the time of loss; without it, property insurance recovery is not payable.
- Utmost good faith
- Insurance contract duty requiring both parties to deal honestly and disclose material facts; concealment or misrepresentation can affect coverage.
- Contract of adhesion
- Policy drafted by the insurer and accepted by the insured; ambiguous policy language is generally construed against the insurer that drafted it.
- Subrogation
- After paying a covered loss, the insurer acquires the insured's legal right to recover from a liable third party, avoiding double recovery.
- Actual cash value
- Claim measure equal to replacement cost minus depreciation; used when the policy settles losses on an actual cash value basis.
- Coinsurance clause
- Property policy condition requiring insurance at least a specified percentage of value; recovery may be reduced if the carried limit is lower.
- Proximate cause
- The dominant, uninterrupted cause connecting a covered peril to a loss; it determines whether damage is covered under the policy.
- NC Department of Insurance
- State agency headed by the Commissioner of Insurance that licenses and regulates insurers, producers, and adjusters and enforces insurance laws.
- Adjuster license
- North Carolina requires a license before a person investigates or settles claims for an insurer, subject to statutory exemptions.
- Continuing education
- Licensed adjusters must complete continuing education and renew credentials under requirements set by the North Carolina Department of Insurance.
- Unfair trade practices
- North Carolina law prohibits deceptive insurance acts and unfair claim settlement practices, allowing Commissioner enforcement and penalties.
- Commissioner authority
- The Commissioner may examine records, investigate complaints, issue orders, suspend or revoke licenses, and impose administrative penalties.
- Public adjuster
- A licensed representative who contracts with and represents the insured for compensation in preparing, presenting, or settling a claim.
- License nontransferable
- An adjuster license belongs only to the named licensee and does not transfer to another person, entity, or business.
- Reportable changes
- Licensees must notify the Department of required changes such as address, criminal convictions, or administrative actions within prescribed timeframes.
- HO-3 policy
- Homeowners form insuring the dwelling on open-peril basis and personal property on named-peril basis, with liability and medical payments coverage.
- NC auto minimum limits
- North Carolina minimum liability coverage is $30,000 per person, $60,000 per accident bodily injury, and $25,000 property damage.
- Collision coverage
- Auto coverage pays for damage to the insured vehicle caused by collision with another object or by upset, subject to deductible.
- Comprehensive coverage
- Auto coverage pays for vehicle damage from causes other than collision, such as theft, fire, hail, flood, or vandalism.
- Occurrence policy
- Liability policy responds to injury or damage that occurs during the policy period, regardless of when the claim is reported.
- Claims-made policy
- Liability policy responds when the claim is first made during the policy period, subject to any retroactive date.
- Business income coverage
- Property coverage replacing lost net income and continuing normal operating expenses during the period needed to restore operations.
- Ordinance or law exclusion
- Property policy limitation excluding or sublimiting costs to comply with building codes after a covered loss.
- Reservation of rights
- Letter preserving the insurer's right to deny coverage later while investigation continues; it is not itself a denial.
- Proof of loss
- Sworn statement from the insured providing claim details and supporting amounts; the policy may require it before payment.
- Prompt acknowledgment
- Claim handling standard requiring timely written or oral acknowledgment of a reported claim and contact with the claimant.
- Reasonable investigation
- Adjuster must gather facts, inspect damage, obtain statements, and evaluate coverage before denying or paying a claim.
- Unfair denial
- Refusing to pay a claim without conducting a reasonable investigation of the facts and applicable policy provisions.
- Settlement basis
- Payment must reflect covered damages under policy terms and documented evidence, not sympathy or unrelated expenses.
- Subrogation preservation
- Adjuster should identify liable parties and preserve evidence; releasing a tortfeasor can impair the insurer's recovery rights.
- Confidentiality
- Adjusters must protect claimant personal, health, and financial information and use it only for legitimate claim handling.