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What must the adjuster prove when they believe arson was committed?
- Motive on insured's part
- Opportunity on insured's part
What is evidence of arson?
- Building was for sale
- Building was recently purchased
- Family pet was coincidentally absent
- Fire occurs after 11pm, on a weekend or holiday when business is closed
- Sentimental value items missing from scene
- Physical signs of flammable materials or other items that start fire
How do you determine the amount covered?
- ACV vs. Replacement Cost
- Agreed amount - in advance it is determined the value to be paid out in the event of a loss
What are the Insured's duties?
- Provide prompt notice
- Protect property
- Assist with the adjustment process
- Provide Proof of Loss
- Submit to exam under oath
How do adjuster's attempt to minimize losses?
- Determine salvage value
- - Insurer retains right if full value is paid to insured
- Determine subrogation possibilities
- - Go after negligent 3rd party
What are the two types of Business Income Claims?
- Prospective Settlements
- Retrospective Settlements
What is a prospective settlement?
Before property is repaired
What is a retrospective settlement?
After property is repaired and operations have resumed
What are the requirements for a loss?
- Direct damage to property
- Result of a covered cause of loss (primary)
- Occurred at described premises
- Suspension of operations and/or incurring extra expense
What is Business Income?
- Net Income - net profit that would have been earned (based on tax record)
- Continued normal operating expenses (included payroll)
What is Extra Expense?
- To avoid or minimize the shut down and continue operations
- Repair or replace property to reduce the extent of business income loss
What is a period of restoration?
- Begins 72 hours after the damage occurs
- No waiting period for extra expense
- Ends when property should reasonably be stored or repaired
- Ends when business is resumed at a new permanent location
- 72 hour waiting period is considered deductible
- Determining the restoration period is key to settling business income claims
With respect to liability claim adjusting, how do you determine coverage?
- Claimant's allegation
- Is it something insured is protected against?
- Cover even if false
- - If there is reasonable assumption that it could be covered
- Bodily injury or property damages
- - What most liability policies will pay
- Intentional act?? (Not covered)
With respect to liability claim adjusting, how do you determine legal liability?
- In a lawsuit - insurer defends in court
- As long as it seems reasonable that the coverage might apply to the claim and could conceivably be covered
- Does not matter if claim ends up groundless, fraudulent, false, etc.
With respect to liability claim adjusting, how do you determine damages?
- Medical treatments
- Loss of earnings
- Pain and suffering
- Permanency and disfigurement
- Loss of consortium
- Survival Actions
- Wrongful Death
What are survival actions?
Costs (medical bills, loss of wages) that claimant could recover prior to death
What is wrongful death?
Legal actions that survivor of deceased can pursue
With respect to liability claim adjusting, how do you negotiate and settle claims?
- Duty to settle
- Structured settlement
- Advanced payment and walk away settlement
What is meant by duty to settle?
- Insurer has a right to fight - especially in cases of fraud or frivolous claims
- Good judgment to sometimes settle
- Legal obligation when it approaches the liability limits
- Could result in a bad faith claim insurer
What is meant by structured settlement?
- Lump Sum Payment plus a series of future payments
- High cost claims, future damages, or children
What is meant by advanced payment and walk away settlement?
- Discourage claimants fro hiring attorneys
- Quick - small lump sum payout