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IF2-c > 11 - Valid Claims and claims settlement > Flashcards

11 - Valid Claims and claims settlement Flashcards

1
Q

Under claims what does it mean by the onus of proof rests on the insured

A

It is the insureds responsibility to prove that they have a valid claim

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2
Q

What two ways can the insured prove that they have had a valid claim

A
  1. That an insured peril arose (The insured must prove that they have suffered a loss directly caused by the insured peril; usually in a completed claim form)
  2. That they have suffered a financial loss - show a receipt etc
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3
Q

If the insurer wants to void the claim their responsibilities are to prove that:

A
  1. The cover was in force at the time of the loss
  2. The insured is that named in the policy
  3. The peril is covered
  4. The insured has taken reasonable steps to minimise the loss
  5. All conditions and warranties have been complied with
  6. The duty of fair presentation has not been breached
  7. No exceptions are appropriate
  8. The value of the loss is reasonable
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4
Q

What three policy terms means that a claim may only be partially met

A
  1. The sum insured (re property Ins) or limit of liability (liability ins) limiting the maximum amount recoverable. If the loss is greater than this sum or limit, the insured’s recovery is limited to this sum
  2. Operation of the average clause (the insurer may apply average to under-insured claims)
  3. Excesses
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5
Q

What does ex gratia payments mean

A

They are made out of favour

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6
Q

What happens if an insurer makes an ex gratia payment

A

It acquires no subrogation rights

Nie nabywa prawa subrogacji

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7
Q

What are the implied duties of the insured after a loss

A

Should act as though uninsured and take all reasonable steps to minimise the loss

May be required to advise authorities (fire service over fires)

Must take all steps to prevent the loss from spreading

Must not hinder the insurer in the claims investigation process

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8
Q

What is the notification condition.

A

It sets out the duties of the insured on the happening of the event insured against

MSZ- Some require the insured to notify the insurer asap after the event that is likely to lead to a claim. The notification can be in writing, sometimes telephone or by calling the local branch office); could be also done digitally;

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9
Q

What are the 4 basics of the notification condition

A

Prompt notification to the insurer

Involvement of the police

Reasonable prevention of further damage

Proof and details of loss in writing

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10
Q

What are the purposes of a claim form

A

Establish whether the insured is entitled to indemnity under the policy

Provide sufficient info

Enable the insurer to take a view to the severity

Enable to insurer to take a preliminary view whether a third party can claim

Enable to the insurer to consider whether any potential recovery rights can exist

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11
Q

Why is a motor claim form called an accident report form

A

It is a condition for the insured to report any incident regardless if they are going to make a claim.

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12
Q

What is the typical contents of a property claim form

A
  1. Description of the property damaged
  2. Date, cause, circumstance and monetary amount of loss
  3. Situation and occupancy of the premises
  4. Capacity in which the insured is claiming
  5. Whether any other person is interested in the property loss or damage
  6. Whether there is other insurance in force
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13
Q

What is the typical contents of a motor accident claim form

A
  1. Details of the insured
  2. Date and time of the accident
  3. Vehicle involved
  4. Who was driving
  5. Details of the accident
  6. Other parties involved, etc.
  7. Any witnesses
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14
Q

How can claim apps help the insured

A

Help to make a claim by using helpful step by step guide

Giving all phone numbers at hand

Allowing them to send claim details straight to the insurer

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15
Q

What are the 3 things an app can help with in regards to a motor accident

A
  1. Use GPS to show the insurer exactly where the claim occurred
  2. Upload photos of any damage
  3. Take down the name and address of anyone who saw it happen
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16
Q

What two things can a household claim app do

A
  1. Keep copies or receipts and warranties for valuables

2. Phone camera to show damage to their home and belongings

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17
Q

What is the supporting evidence required for theft claims

A

Compare details of the property stolen

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18
Q

What is the supporting evidence required for accident claims

A

May be desirable to obtain an engineers report, scale plans and photographs or accident book

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19
Q

What is the supporting evidence required for personal and accident claims

A

Medical evidence

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20
Q

What is the supporting evidence required for motor claims

A

A vehicle registration document

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21
Q

What is a loss adjuster

A

An independent and professionally qualified expert in processing claims from start to finish.

Loss adjuster completes a claim report, providing detailed comments on the incident leading to the claim and recommends to the insurers what settlement should apply.

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22
Q

What does a loss adjuster do

A

Checks that the cover was in force and was adequate at the time of the loss

Provides estimates of the potential loss

Completes a claim report

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23
Q

What is a claims contribution

A

Where the insurer has the right to call on other insurers similarly but not necessarily equally to share the loss of a payment

24
Q

What is the typical base formula for contribution

A

Sum insured by individual insurer divided by total sums insured x loss

25
Q

How is average worked out

A

Sum insured divided by value at risk x loss

26
Q

Can average apply to liability policies

A

No because there is no chosen limit of indemnity

27
Q

What is subrogation

A

Where there are third parties involved who were the cause of the loss of damage insurers can put pursue these to recover monies lost

28
Q

What is arbitration

A

The arbitration clause deals with disputes which arise as to the amount paid in settlement of a claim

29
Q

What happens under the Civil Procedure Rules

A

Courts are under a duty to encourage the parties to use an alternative resolution procedure

30
Q

What are the benefits of an alternative dispute resolution

A

Speed of completion

Can be timed to suit the parties

Less costly than a court trial

Settlements are confidential

31
Q

What is meant by mediation alternative disputes resolution

A

Where the parties choose to participate and any agreement reached to settle the dispute is made solely by the parties themselves

The mediator acts as a facilitator and helps the two parties reach a decision

32
Q

What is a conciliation alternative disputes resolution

A

It’s similar to mediation except the conciliator leads the parties to a settlement

The parties have to agree they are bound by the conciliation recommendations

33
Q

What are the 3 stated purposes of the ABI personal effect contribution agreement

A
  1. Avoid adverse publicity and criticism of the insurance industry cause by insurers
  2. Avoid costly and time consuming handling of payment of part or all of the claim
  3. Sets out rules for contribution between participating insurers
34
Q

What are the contribution rules for motor accidents

A

No contribution

35
Q

What is the contribution rules for specified items

A

Generally no contribution

36
Q

What is a bilateral agreement

A

Insurers are entering into bilateral agreements with others who operate in the same market.
e.g. the motor insurance subrogation portal

Goes on a subrogation portal and it helps reduce time getting claims recovered from other insurers

37
Q

What is the uninsured drivers agreement

A

It exists to deal with a situation where cover is not in place to provide compensation where a third party is concerned

Step up to settle the damages to third parties for personal injury’s

38
Q

What is the untraced drivers agreement

A

Covers ‘hit and run’ cases, where the motorist involved in the accident cannot be traced.

39
Q

When will the MIB pay out on untraced drivers agreement?

A

Where damage has been made to third-party property.

Or significant personal injury to the same accident subject to death. Or 4 or more days of consecutive hospital treatment

40
Q

What is the untraced drivers agreement 2017

A

There’s no exclusion for vehicle damage claims where the vehicle was insured

There is an excess on property damage of £400

The claimant is required to report the accident to the police

Interest in general damages runs from the date of the accident

41
Q

What happens if payment for a claim is paid by money

A

Requires a form of discharge to completed by the recipient to confirm they have received the payment

42
Q

Who can pay for repairs

A

Insurers can pay for the cost of repairs directly to the repairers

43
Q

What is the third parties act 2010

A

Under the act a third party doesn’t need to first obtain judgement against the insured before issuing a claim but the liability of the insured to the third party must be established

44
Q

What is the document request under the third parties insurers act 2010

A

Enhances third parties with a right to request insurance info from insurers provided they can show a reasonable belief that liability is owned by an insured

45
Q

What is the Enterprise Act 2016

A

It requires insurers to pay sums due following a claim within a reasonable time. It gives policyholders the right to claim damages if a unreasonable delay causes additional costs

46
Q

Accuracy of the reserving process is crucial because

A

Insurers are required to submit financial statements each year to the PRA (Prudential Regulation Authority)

May have an impact on premium rates

It’s important element of its liability is adequately estimated for the profitability of an insurer

47
Q

How do insurers determine a claim reserve

A

Examination of past data on claims

48
Q

What is meant by right of recovery under claims

A

The insurer has a certain rights following an incident which gives a rise to a claim. One of these rights is the recovery or stolen of lost property.

49
Q

If fraud is committed does an insurer have to pay a claim

A

No liability to pay that claim And any payment already made can be recovered

50
Q

What three bodies are used for fraud prevention

A

The Insurance Fraud Bureau

  • not for profit organisation funded by the insurance industry

The Insurance Fraud Investigators Group

The Insurance Fraud Register

51
Q

What measures are undertaken to detected fraud within the insurance industry

A

Claims and underwriting exchange- insurers submit details for individual claimants to check history

Art loss register - deals with stolen art

Motor insurance anti fraud and theft register

Claims handler

52
Q

How soon just the MID update vehicle details

A

Seven days for private car risks

14 days for commercial

53
Q

What are the 5 other possible Indicators of fraudulent claims

A
  1. Too much documentation
  2. Insured changes their story
  3. Loss was not reported to the police
  4. Claim is not consistent with the insured lifestyle
  5. Poor claims history
54
Q

What is the consequence of fraud in the insurer

A

Claims costs can rise which increases premiums which means less competitive

55
Q

What are the consequences of fraud on the insureds

A

Premiums will increase

IF2-c (11 decks)

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