Chapter 4 Claims handling procedures and additional claims services Flashcards Preview

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Flashcards in Chapter 4 Claims handling procedures and additional claims services Deck (51)
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1

What are the key considerations for personal motor claims?

- the insurer may need to consider third party injury claims

- the insurer may need to consider third party property damage claims

- the insurer deals with the insured's repairs if covered by the policy

- the insurer establishes a policy is in force and investigates the claim

- the insured usually has to complete an accident report form.

2

Describe medical expense policies.

A medical expenses policy covers the policyholder for defined expenses of undergoing in-patient or out-patient treatment in private hospitals.

In the event of a valid claim, appropriate invoices for such treatment are provided to the insurer for settlement.

3

How do benefit policies work?

The settlement figure is a pre-agreed lump sum or weekly payment, set at the start of the contract, that will be paid if certain prescribed events happen (e.g. accidental death; the loss of an eye in an accident).

When dealing with claims for serious injury the insurers may need to establish the prognosis to identify whether the claim will be settled under the accident or the death section.

4

What are durable goods in home insurance?

Items that do not wear out as quickly as 'consumer goods'.

Most insurers will provide in their home insurance policy wording that claims for durable goods are settled on a 'new for old' basis.

This means that the damaged goods, that cannot be repaired, will be replaced by new items, without any deduction for wear and tear.

EXAMPLES fridges and household items.

5

What are consumer goods in home insurance?

Less durable items that are likely to wear out more quickly than 'durable goods'.

Claims for consumer goods are generally settled on the basis of the cost of a new replacement less an allowance for wear and tear, according to their age.

EXAMPLES curtains, linen, clothing.

6

What is betterment?

Betterment is a situation which arises where the repair or replacement is 'better' than the original,

for example, replacing an old single-glazed window with a double-glazed unit.

7

How does Reinstatement indemnity work in property insurance?

The insurer undertakes to restore a building (or machinery) that has been damaged.

Having agreed to reinstate, the insurer must bear the cost, whatever it is, and be its own insurer for the re-build period.

There is also the need to restore the property as closely as possible to its pre-loss condition.

8

How do independent loss adjusers operate in property insurance?

A loss adjuster investigates a loss and prepares a report recommending the amount payable under the terms of the policy.

They will investigate the cause of the loss as well as its extent and ensure that the insured has complied with any policy endorsements or warranties.

The insured may appoint a loss assessor to act on their behalf and negotiate with the adjuster and/or the insurers.

9

How does legal expenses insurance cover work?

Although legal expenses insurance covers the legal costs associated with pursuing or defending a civil court action, this is only if the insurer agrees to such action.

A policyholder has to notify their insurers before legal action is commenced or a defence is entered, giving the insurer the opportunity to assess the proposed claim.

This would include, for example, the insurer appointing its own solicitors to give an opinion on the chances of a successful action and, if appropriate, co-operating with the insured in attempting to reach a settlement before the court action starts. If the insured pursues an action against the advice of the insurer's solicitor, the costs of this would not be covered.

10

What is one of the key considerations with a business interruption claim?

For the claim to be valid the insured must normally have complied with the material damage warranty.

11

What is a material damage warranty?

A warranty that requires that property insurance is in force to cover the material damage claim, before the BI policy will come into operation.

This is necessary to avoid the possibility that the interruption period is extended because there is no insurance in place to pay for repairs/rebuilding.

Both policies are usually with the same insurer and the BI claim will be run in conjunction with the property damage claim.

12

What are the three possible claims triggers for liability claims?

Causation

Most Employers' Liability (EL) policies cover bodily injury or disease caused during the period of insurance. This could actually be over several years if the injury is slow in onset, (e.g. asbestosis or work-related repetitive strain injury).


Occurrence

This is the normal basis of cover under public and products liability insurances. The insurer who is on cover when the accident occurs (e.g. when a defective wall collapses onto a passer-by rather than when it was built) deals with the claim.

Claims made

Where cover is written on this basis, the insurance will only indemnify the insured for claims that are notified during the current period of insurance. This means that provided a claim is made during the period of insurance, it does not matter when the event leading to the loss took place. Professional indemnity insurance is written on a claims-made basis.

13

What are the additional services associated with the claims handling and settlement process:

- help-lines (or advice lines)

- authorised repairers and suppliers

- uninsured loss recovery services

- legal costs services

- risk control/advice.

14

Name the features of motor policy help-lines.

Many insurers now adopt a streamlined motor claims process with the assistance of a help-line. Features of such a service include:

- accident details are taken over the phone, advice is provided (e.g. about what to do next), and a claim form is issued (already part-completed)

- collection of the car and delivery to an approved repairer can be arranged if it is undriveable (and the damage is covered)

- if appropriate a temporary replacement car can be arranged

- insurance staff can call the customer back to ensure satisfaction with repairs and act as a contact throughout the claim process.

15

Name the features of home policy help-lines.

Insurers use the following process with the assistance of a help-line:

- customers can phone a free help-line at any time
details are taken, advice is provided, and a part-completed claim form is issued

- insurance staff can then arrange for repairs or replacement

- if necessary, the bill can be settled directly with the repairer

- insurance staff can call the customer back to ensure satisfaction and act as a contact throughout the process.

16

Name the features of motor policy help-lines.

Legal advice help-lines are available to guide a policyholder through the legal process in a practical way. The advisers will be barristers or solicitors.

Calls may be made on common legal issues, such as boundary disputes, or more complex contractual implications and obligations. The help-line can assist the insured whether they are pursuing or defending a legal claim.

17

Name the features of legal advice help-lines.

Legal advice help-lines are available to guide a policyholder through the legal process in a practical way. The advisers will be barristers or solicitors.

Calls may be made on common legal issues, such as boundary disputes, or more complex contractual implications and obligations. The help-line can assist the insured whether they are pursuing or defending a legal claim.

18

What are authorised or/ approved repairers and suppliers?

suppliers and/or repairers who enter into an agreement to provide their service to repair / replace something that has been insured.

They're commonly used in motor insurance.

19

What are the benefits of having an authorised or/ approved repairers and suppliers?

- Cheaper costs
- A more competent repair
- Less administration

20

What are Uninsured loss recovery services?

Services that assist policyholders in claiming against responsible third parties for losses not covered by their policies.

e.g. motor insurance

21

Laura has comprehensive cover under her private motor policy when another car is negligently driven into hers and she incurs various losses as a result.

What claims would you expect to be made on Laura's behalf by her insurer's uninsured
loss recovery service?

- The excess under her motor policy

- The cost of hiring another car while her own is being repaired (her policy does not cover this)

- Compensation for the injuries she suffers in the accident

22

Who else may pursue claims for uninsured losses?

Solicitors and accident management companies, where they feel their client is completely blameless, usually on a 'no win - no fee' arrangement.

23

What is risk management?

'The identification, analysis and economic control of those risks which can threaten the assets or earning capacity of an enterprise'.

24

What does risk identification and analysis involve?

This involves identifying the risks that an organisation faces and then analysing the likelihood of these risks occurring and the potential cost to the organisation if they do occur.

25

What does risk control involve?

Risk control involves putting into action plans to avoid or reduce the risk.

Risk controls may be either:

- physical - e.g. installing guards on machinery, or lining chimneys with fire resistant material); or

- financial - e.g. putting aside money to meet the cost of any losses, or paying an insurance premium to transfer a risk to an insurer.

26

What would you expect to be the insurer's main concern in providing risk control advice to its policyholder?

Reducing the frequency and severity of insured losses.

27

Up to what amount must Motor third party claims be brought in the RTA portal

£25,000

28

What is the maximum legal costs award for claims under
£10,000 settled in the RTA portal

£500 plus VAT

29

What is the maximum legal costs award for claims between £10,000 and £25,000 that are settled under the RTA portal?

£800 plus VAT

30

What evidence is required for a permanent total disablement claim under Personal Accident insurance

Medical certificate
That insured is under care of registered doctor