Match each prohibited claims handling action performed by an insurance adjuster to the correct statutory Unfair Claims Settlement Practice it violates.
- Denying a property damage claim without first examining the damage or reviewing any provided evidence.Refusing to pay claims without conducting a reasonable investigation
- Falsely telling a claimant that their policy excludes wind damage to discourage them from pursuing a claim.Misrepresenting pertinent facts or insurance policy provisions
- Ignoring a claimant's phone calls, emails, and written inquiries regarding an open claim for over 45 days.Failing to acknowledge and act reasonably promptly upon communications
- Offering a claimant 15,000, forcing the claimant to hire an attorney and sue.Compelling insureds to institute litigation to recover amounts due
Answer
Action 1 matches 'Refusing to pay claims without conducting a reasonable investigation'. Action 2 matches 'Misrepresenting pertinent facts or insurance policy provisions'. Action 3 matches 'Failing to acknowledge and act reasonably promptly upon communications'. Action 4 matches 'Compelling insureds to institute litigation to recover amounts due'.
Each scenario directly describes a classic violation of the NAIC Unfair Claims Settlement Practices Model Act. Misrepresenting coverage relates to providing false policy information; ignoring calls is a failure to acknowledge communication; denying a claim without reviewing evidence is a failure to investigate; and extreme lowballing constitutes an attempt to compel litigation.
Step-by-Step Solution
Key Concept
Unfair Claims Settlement Practices Acts identify specific prohibited behaviors by insurers and their adjusters to protect consumers from bad faith claims handling and delays.