Review the following complex claims scenarios. Match each specific adjuster action or insurer policy to the exact statutory violation category it represents under the NAIC Unfair Claims Settlement Practices Model Act.
- A liability adjuster refuses to tender an undisputed bodily injury settlement to a claimant unless they also sign a release dropping a separate, disputed property damage claim.Leveraging payment under one coverage portion to influence settlements under other coverage portions.
- An examiner insists a beneficiary provide a formal sworn statement of claim and a standardized proof of death form, even though the initial preliminary report contained substantially the exact same information.Requiring the submission of preliminary reports followed by formal forms containing substantially the same information.
- A commercial property insurer systematically issues claim checks for complex business interruption losses without specifying which specific time period or coverage section is being compensated.Failing to provide statements setting forth the specific coverage under which claim payments are being made.
- An insurer establishes an internal directive to routinely inform claimants that binding arbitration awards over $10,000 will be appealed in order to encourage lower negotiated settlements.Making known a policy of appealing arbitration awards to compel claimants to accept lesser settlements.
Answer
The correct matches align specific adjuster tactics with explicit NAIC statutory prohibitions: withholding undisputed BI funds matches cross-coverage leverage; demanding redundant forms matches duplicate reporting prohibitions; vague checks match the failure to specify coverage; and threatening appeals matches the prohibition on coercive arbitration appeal policies.
Each scenario represents a highly specific, nuanced violation of the NAIC Unfair Claims Settlement Practices Model Act. Proper identification requires distinguishing between legitimate aggressive negotiation or thorough investigation, and tactics that cross the line into statutory violations such as cross-coverage leverage, duplicate documentation demands, lack of payment transparency, and coercive arbitration threats.
Step-by-Step Solution
Key Concept
NAIC Unfair Claims Settlement Practices Model Act Violations
Estimated Time:2m 0s