Match each improper claims handling scenario to the specific statutory violation it represents under the Unfair Claims Settlement Practices Act.
- A commercial casualty insurer waits 90 days after receiving a completed proof of loss form before notifying the insured of its coverage decision.Failing to affirm or deny coverage within a reasonable time after proof of loss is submitted.
- An auto liability adjuster requires a preliminary accident report, then later demands a formal sworn statement containing the exact same details.Demanding unnecessary duplicate proof of loss or claim information.
- A homeowners property insurer offers 25,000 fire loss, forcing the policyholder to file a lawsuit to obtain a fair settlement.Compelling insureds to institute litigation by offering substantially less than the amounts due.
- A life insurance claim is denied based on an exclusion that was secretly added to the original application by the agent after the applicant signed it.Attempting to settle a claim on the basis of an application altered without the insured's consent.
Answer
The correct pairings match each specific claims handling scenario with its corresponding statutory violation category, demonstrating how unfair practices manifest across different lines of insurance.
Each scenario directly illustrates a distinct violation outlined in the NAIC Unfair Claims Settlement Practices Model Act. Waiting 90 days after proof of loss violates strict timeline requirements. Asking for identical information in two different forms is an illegal duplicative demand. Lowballing undisputed claims forces unnecessary litigation. Denying claims based on secretly altered applications is an explicit violation of contract and settlement regulations.
Step-by-Step Solution
Key Concept
Recognizing specific prohibited claims handling behaviors and their corresponding statutory violations under state insurance regulations.
Estimated Time:1m 30s