An adjuster evaluates coverage for first party claims using a decision tree model. In this process, one decision leads to the next action and each action depends on the preceding answer. Based on this decision tree, the adjuster can either decide to pay the claim, to investigate further, or to deny the claim. Throughout the process, the adjuster must be thorough and methodical to achieve a fair result.
Here are the considerations that the adjuster undertakes:
Evaluating Coverage for Third-Party Claims
When evaluating coverage for third-party claims under a liability policy, the adjuster uses a two-pronged analysis. The policy is first examined to determine whether coverage extends to the insured. For example, determining if the policy is in force at the time of the loss. Then, the policy is examined to determine if the nature of the claim is covered. Any exclusions, limitations, or conditions of coverage are explored at this time. These items will be revisited after a detailed investigation is completed.
There are several questions that should be considered when investigating a third-party claim. For example:
What are the facts of the case?
What documentary evidence is available?
What other information must be developed?
What is the legal liability of the insured for the occurrence?
Is there any other party who bears any responsibility for the action?
Is there any other insurance policy that might come into play?
Is there a need to retain an expert?
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