Study 1 - Investigating Bodily Injury Claims

Question 1

Reservation of rights letter

Answer 1

An insurer’s notification to an insured that the coverage for a claim may not apply. Such notification allows the insurer to investigate or defend a claim to determine whether coverage applies without waiving its right to later deny coverage based on the information revealed by the investigation.

Question 2

Non-waiver agreement

Answer 2

An agreement signed by a policyholder after a loss, agreeing that the investigation and a determination of the amount of damage by the insurance company shall not be construed as an admission of liability. It is used when the insured is in violation of a policy condition and there is a question as to whether or not the insurance company is labile for a loss, but the company wishes to investigate the loss and determine the amount of damage.

Question 3

Estoppel

Answer 3

A bar created when someone by his action or lack of it indicates that he will not exercise a right he has. He estops himself from exercising that right later.

Question 4

Subrogation

Answer 4

Once an insurance company has paid a loss for which someone other than the policyholder is responsible, it may have the right to recover this loss from the guilty party.

Question 5

Act of God

Answer 5

An accident, event. or sudden act of nature that could not have been foreseen, or if foreseen, its effect could not have been prevented; for example, a flood or earthquake.

Question 6

Forensic experts

Answer 6

A person connected to a court of law who can be hired by an insurer or an insured to appear in court as a witness. The expert combines knowledge of legal cases to the principles of a profession. The expert can help prove or contradict the cause of a claim.

Question 7

Contributory negligence

Answer 7

Many accidents are the partial fault of both parties involved. The plaintiff who sues another party for damages may also be guilty of some negligence, which is a concurrent cause of the damage, and is therefore guilty of contributory negligence.

Question 8

Judgemnt-proof

Answer 8

Refers to persons against whom judgments for money cannot be satisfied because they do not own sufficient property to pay the judgment, do not earn sufficient wages, or are otherwise protected by statute.

Question 9

Volenti non fit injuria

Answer 9

To one consenting, no wrong is done. Where a person voluntarily assumes a risk that results in injury, he or she is not entitled to claim damages from another.