AIC 30

Direct Loss

A reduction in the value of property that results directly and often immediately from damage to that property

Sworn statement

A signed record of events surrounding an event as told by the interviewee that contains language attesting that it's true

initial credibility

The degree of credibility an individual has before interpersonal communication begins

service of process

The delivery of a summons and complaint to a defendant by an authorized person

Negotiation Techniques for claimants w/ representatives

using info obtained from the claim evaluation, establishing strengths and weaknesses, using timing in negotiation, making the first offer, making concessions

Roundtable method

A method of setting reserves by using the consensus of two or more claims personnel who have independently evaluated the claim file

Expert system method

A method of setting reserves with a software application that estimates losses and loss adjustment expenses

General Damages

A monetary award to compensate a victim for losses, such as pain and suffering, that does not involve specific, measurable expenses

Jurisdiction

A particular court's power or authority to decide a lawsuit of a certain type or within a certain territory

Claimant

A party that makes a claim and that can be either first party claimant or a third party claimant

Punitive Damages

A payment awarded by a court to punish a defendant for a reckless, malicious, or deceitful act to deter similar conduct; the award need not bear any relation to a party's actual damages

Direct Question

A question that seeks specific information and that can often be answered with a short phrase or a yes or no response

Loss ration

A ratio that measures losses and loss adjustment expenses against earned premiums and that reflects the percentage of premiums being consumed by losses

request for production of documents

A request made by either the plaintiff or defendant in a lawsuit to the opposing side to provide all the documents and other tangible evidence it has in its possession relating to the facts of the case.

Non Waiver agreeement

A signed agreement indicating that during the course of investigation, nether the insurer nor the insured waives rights under the policy

Lose Lose

When the negotiator has little concern either for obtaining the best outcome or for achieving rapport

Lose-Win

When the negotiator is primarily concerned with achieving rapport with the other party male and obtaining the best out come is a low priority

win-win

When the negotiator seeks both to obtain the best outcome and to achieve rapport with the other party, resulting in a settlement that is satisfying to all parties

Special Damages

a form of compensatory damages that awards a sum of money for specific, identifiable, expenses associated with a persons loss such as medical expenses or lost wages

Fraud

An intentional misrepresentation resulting in harm to a person or an organization

Complaint

The allegations made by a plaintiff in a lawsuit.

Decoding

The process by which a receiver interprets a senders message

Maslow Hierarchy of Needs Theory

(From bottom to top) Physiological, safety and security, belongingness and love, esteem, self actualization

Ex Parte Contacts

Contacts in which only one party is heard

First Party Claim

A demand by an insured person or organization seeking to recover from its insurer for a loss that its insurance policy may cover

Boulwarism

A bargaining style named for Lemuel Boulware, former CEO of General Electric, in which one's first offer is one's final offer.

Average Value Method

A case reserving method that establishes a predetermined dollar amount of reserve for each claim as it is reported

4 steps of negotiation

1. preparation 2. Develop and evaluate alternative outcomes 3. identify and evaluate each party's interests 4. make concessions and create appropriate resolutions

Allegation

A claim made in the complaint by the plaintiff, specifying what the plaintiff expects to prove to obtain a judgment against the defendant.

Coinsurance Clause

A clause that requires the insured tp carry insurance equal to at least a specified percentage of the insured property's value

Contributory Negligence

A common law principle that prevents a person who has been harmed from recovering damages if that persons own negligence contributed in any way to the harm

Comparative Negligence

A common law that requires both parties to a loss to share the financial burden of the bodily injury or property damage according to their respective degrees of fault

Counterclaim

A complaint brought by the defendant against the plaintiff

Third party claim

A demand against am insured by a person or organization other than the insured or the insurer, seeking to recover damages that may be payable by insureds liability insurance

Independent Medical Examination

A direct intervention technique that includes a brief review pf the patients history and treatment and a physical examination of the patient. Insurers use this technique in disputed claims for determining causation, current physical impairment, and the need for present or future treatment

Answer

A document filed in court by a defendant responding to a plaintiff's complaint and explaining why the plaintiff should not win the case.

Summons

A document that directs a sheriff or another court-designated officer to notify the defendant named in the lawsuit that a lawsuit has been stated and that the defendant has a specified amount of time to answer the complaint

Misrepresentation

A false statement of a material fact on which a party relies.

Pleading

A formal written statement of the facts and claims of each party to a lawsuit.

Loss history

A listing of past claims, including the date of occurrence, the line of business, the type or description of the claim, the date of the claim, the amount paid, the amount reserved, and the claims current status

Indirect Loss

A loss that arises as a result of damage to property other than the direct loss to the property

Formula Method

A method of setting claim reserves by using a mathematical formula

Compensatory Damages

A payment awarded by a court to reimburse a victim for actual harm

Claims representative

A person responsible for investigating, evaluating, and settling claims

Appraisal Clause

A policy provision that prescribes a method for resolving a disputed claim about the value of property or the amount of a property loss

Deposition

A pretrial discovery tool involving oral examination of a witness to produce a written verbatim record

Discovery

A pretrial exchange of all relevant information between the plaintiff and defendant.

Estoppel

A principle that prohibits a party from asserting a claim or right that is consistent with with that party's past statement or conduct on which another party has detrimentally relied

Open-ended question

A question that seeks an answer that explains or elaborates on the circumstances under consideration

Leading Question

A question that seeks or suggests a particular answer

Conflict of Interest

A situation that occurs when a decision maker's personal interests interfere to the extent that he or she makes decisions that adversely affect customers or employers

Examination Under Oath

A statement given by a person who has sworn to tell the truth before an officer of the court

Proof of Loss

A statement of facts abut a loss for which the insured is making a claim

Hard Fraud

Actions that are undertaken deliberately to defraud.

STAGED ACCIDENT

An accident deliberately caused by a person who intends to feign injury and collect on the ensuing claim.

Mini Trial

An alternative dispute resolution method by which a case undergoes an abbreviated version of a trial before a panel or an advisor who poses questions and offers opinions on the outcome of a trial, based on the evidence presented

Summary Jury Trial

An alternative dispute resolution method by which disputing parties participate in an abbreviated trial presenting the evidence of a few witnesses to a panel or mock jurors who decide the case

Mediation

An alternative dispute resolution method by which disputing parties use a neutral outside party to examine the issues and develop a mutually agreeable settlement

Arbitration

An alternative dispute resolution method by which disputing parties use a neutral outside party to examine the issues and develop a settlement, which can be final and binding

Pro Rata Contribution

An approach to other insurance by which the insurers contribute to the loss payment in the proportion to which they contribute to the total amount of coverage purchased

Loss reserve

An estimate of the amount of money the insurer expects to pay in the future for losses that have already occurred and been reported, but are not yet settled

Independent Adjuster

An independent claims representative who handles claims for insurers for a fee

terminal credibility

An individuals perceived credibility after interpersonal communication in a given situation situation has occurred

derived credibility

An individuals perceived credibility during interpersonal communication

Insurable Interest

An interest in the subject of an insurance policy that is not unduly remote and that would cause the interested party to suffer financial losses if an insured event occurred

Third Party Administrator (TPA)

An organization that provides administrative services associated with risk financing and insurance

Public adjuster

An outside organization or person hired by an insured to represent the insured in a claim in exchange for a fee

Insurance fraud

Any deliberate deception committed against an insurer or an insurance producer for the lurpise of unwarranted financial gain

Substituted service (constructive service)

Any method of notifying a defendant of a lawsuit other than personal delivery of a summons and complaint

nonverbal communication

Communication that is not spoken or written, including eye movement, kinesics, appearance, and time and space

Good faith

Consideration given to the insureds interest that is at least equal to that given to the insurers interests in handling the claim

Negotiation variables

Financial needs, claimants negotiation phase, tie pressures, claimants emotional reaction to the loss, claimants experience or knowledge w/ claims, personality

Soft Fraud

Fraud that occurs when a legitimate claim is exaggerated

Actual Service

Hand delivery of a summons and complaint to a defendant.

Material Fact

In insurance, a fact that wohld affect the insurers decision to provide kr maintain insurance or to settle a claim

Reservation of Rights letter

Insurer's letter that specifies coverage issues and informs the insured that the insurer is handling a claim with the understanding that the insurer may later dent coverage should the fact warrant it

Reserve

The amount the insurer estimates and sets aside to pay on an existing claim that has not been settled

Trading Dollars

Negotiation about demand/ amount rather than about claim facts

Forms of Representational Documentation

Photographs, Maps, Diagrams, Video footage

Alternaive Dispute Resolution

Procedures to help settle disputes without litigation, including arbitration, mediation, and negotiation

Interrogatories

Specific written questions or requests raised by one party to a lawsuit that the opposing party must answer in writing.

Statutory Law

The forma laws, or statutes, enacted by federal, state, or local legislative bodies

Waiver

The intentional relinquishment of a known right

Legal Liability

The legally enforceable obligation of a person or an organization to pay a sum of money to another person or organization

Venue

The locale in which the lawsuit may be brought

Medium

The means by which a message is transmitted from sender to receiver

Receiver

The person who chooses from the verbal and non verbal symptoms in the senders message to interpret the messages meaning

Sender

The person who initiates the communication process

Subrogation

The process by which an insurer can, after it has paid a loss under the policy, recover the amount paid from any party who caused the loss or is otherwise legally liable for the loss

active listening

The process of listening with mental and physical openness to more clearly determine a messages meaning

Encoding

The process of translating a message into words

Ethics

The study of what constitutes good and bad behavior, dealing with moral duty and obligaiton

Message

The words a sender uses in the communications process and their underlying theme

win-lose

When a negotiator seeks only the best outcome for their side and not the others

Individual case method

a method of setting reserves based on the claims circumstances and the claims representatives experience in handling similar claims

default judgement

an automatic judgement against a party to a lawsuit who fails to appear in court or to answer a pleading

Concealment

an intentional failure to disclose a material fact

Extraneous information

extra, unnecessary information

Negligence

the failure to exercise the degree of care that a reasonable person in a similar situation would exercise to avoid harming others

Spoilation

the failure to preserve property for another's use in litigation