SC Claims Adjuster cheat sheet

Insurance transfers risk from an individual to a pool of policyholders; the insurer retains the pooled risk of loss in exchange for premium.

Insurable interest in property must exist at the time of loss; in life insurance it must exist at policy inception.

The indemnity principle limits recovery to the actual financial loss; valued policies and replacement cost coverage are the recognized exceptions.

Actual cash value = replacement cost minus depreciation. Replacement cost coverage pays repair or replacement with no depreciation deduction, usually after repairs are complete.

Utmost good faith: a material misrepresentation, concealment, or breach of warranty that induced the insurer to issue the policy can void coverage.

Moral hazard is dishonesty created by insurance (arson, staged losses); morale hazard is carelessness; both increase expected loss costs.

Proximate cause is the efficient, dominant cause that sets an unbroken chain of events in motion and determines whether a covered peril triggered the loss.

Subrogation lets the insurer recover from the legally liable third party after paying the insured; the insured cannot collect twice for the same loss.

Waiver is the intentional relinquishment of a known right; estoppel bars an insurer from asserting a right after the insured reasonably relied on the insurer's conduct.

HO-3 covers the dwelling and other structures on an open-peril basis and personal property for named perils; HO-5 is open peril on both; HO-2 is broad named peril; HO-4 renters, HO-6 condo, HO-8 older homes.

Typical homeowners relationships: Coverage B (other structures) about 10% of Coverage A; Coverage C (personal property) commonly 50-70% of Coverage A; Coverage D (loss of use) commonly 20-30% of Coverage A.

Coinsurance formula: (limit carried / limit required) x loss = payment, capped at the policy limit, where limit required = coinsurance percentage x value at risk.

Straight deductibles are a fixed dollar amount per loss; percentage deductibles apply a stated percent to the Coverage A limit, commonly for hurricane or named-storm perils.

Occurrence liability policies respond to injury or damage that happens during the policy period; claims-made policies respond to claims first made during the period, subject to a retroactive date.

CGL limits: the per-occurrence limit is the most paid for any one occurrence, the general aggregate caps all covered losses in the policy period, and products-completed operations has its own aggregate.

Business income pays net income plus continuing operating expenses during the period of restoration; extra expense pays costs incurred to avoid or shorten the shutdown.

Personal auto coverage parts: A liability, B medical payments, C uninsured/underinsured motorists, D physical damage (collision and other-than-collision), plus towing and rental.

Umbrella and excess policies follow form above scheduled underlying limits and may drop down to cover gaps in underlying coverage, subject to a self-insured retention.

Claim cycle: acknowledge the claim, investigate and document, evaluate coverage and damages, negotiate, then pay or deny with a written explanation citing specific policy language.

Coverage analysis order: Is the policy in force? Is the claimant an insured? Is the property or location covered? Is the peril or occurrence covered? Does an exclusion apply? What limit and deductible apply?

The insured generally bears the burden of proving the loss falls within coverage; the insurer bears the burden of proving that a policy exclusion applies.

Reservation of rights letters and nonwaiver agreements preserve coverage defenses while the insurer continues to investigate or defend the claim.

Common policy conditions: prompt notice of loss, proof of loss, examination under oath, records and documents, cooperation, and mitigation of further damage.

Subrogation handling: identify third-party liability early, preserve evidence, avoid releasing the responsible party, and recover net of allocated expenses.

Salvage reduces the net claim payment; betterment and depreciation are deducted where the policy pays actual cash value rather than replacement cost.

A vehicle is a total loss when damage exceeds the state's total-loss threshold; settlement is typically actual cash value plus applicable taxes and fees, minus deductible and salvage value.

Bad faith exposure increases when liability is clear, a demand is within policy limits, and the insurer fails to settle within limits; document every contact, statement, and document reviewed in the claim file.

The South Carolina Department of Insurance, headed by a Director appointed by the Governor, licenses insurers, producers, and adjusters and conducts market conduct examinations.

A person must hold a South Carolina adjuster license to investigate or settle claims for an insurer; public adjusters are separately licensed and contract with, and are paid by, the insured.

South Carolina compulsory auto liability minimums are $25,000 per person and $50,000 per accident for bodily injury and $25,000 for property damage.

South Carolina insurers must offer uninsured motorist coverage at limits equal to the policy's liability limits; the insured may reject it in writing.

South Carolina follows modified comparative negligence: a claimant more than 50% at fault recovers nothing, and otherwise damages are reduced by the claimant's percentage of fault.

The South Carolina limitations period is three years for personal injury, property damage, and written contract actions, so adjusters diary suit deadlines and preserve evidence.

South Carolina workers' compensation requires notice to the employer within 90 days, pays wage replacement at two-thirds of the average weekly wage, and is administered by the SC Workers' Compensation Commission.

South Carolina licensees must complete 24 hours of approved continuing education every two years to renew, and the state prohibits unfair trade practices and unfair claims settlement practices, including unreasonable delay or denial of claims.