A Masters Course on Property Insurance Claims

Adjusting Property Insurance Claims

If you are manage an insurance claims operation, operate a college based risk management and insurance program, are an insurance adjuster, are a public insurance adjuster, or want to create a professional insurance claims operation you need to train your new and experienced claims personnel. I have created a Master of Arts program in property insurance claims handling. I also have a similar program for liability claims handling.

The following is an outline of the Property Insurance Claims Master of Arts program:

An introduction to the Property Insurance program.

It introduces the excellence in claims handling requirement that should be imposed on all insurers. The program requires that insurers maintain a staff of experienced, well trained, and educated claims staff.

How to Acquire a First Party Property Insurance Policy

The Course covers the following:

Insurance and insurable interest.

  1. That an insurable interest does not require ownership but can be a leasehold interest, an easement, or any other interest where the loss of the property will cause damage to the person acquiring the insurance.
  2. How To use an insurance agent or broker.
  3. The difference between an insurance agent and an insurance broker.
  4. The importance of an insurance application.
  5. The need to read the policy.
  6. Hazards of not reading an insurance policy after it is obtained or issue

How to Read & Understand an Insurance policy

The Course covers the following:

  1. That insurance is a contract and how to understand the basic rules of interpretation of contracts.
  2. The application for insurance and how it is used by the applicant and the insurer.
  3. The need for offer, acceptance and consideration to form an insurance contract.
  4. How to read and understand the insurance contract.
  5. The first party property insurance contract and how it is formed and made effective.
  6. The importance of conditions and limitations in a first party property policy.
  7. The rules of insurance contract interpretation.
  8. The contra preferentum rule.
  9. The Standard fire policy.
  10. The auto material damage policy.

The Necessity for an Honest and Complete Application for Insurance.

The Course covers the following:

  1. What an application is and how it is used by an underwriter.
  2. The difference between a misrepresentation, concealment, or breach of warranty.
  3. The obligation of the applicant to deal fairly and in good faith with the insurer.
  4. What is material to an insurance underwriter.
  5. That fraud is not required to prove the need for rescission.
  6. The general rules with regard to relief for false statements on an application for insurance.

The Law of Contracts for the Insurance Professional

The Course covers the following:

  1. What a contract is.
  2. What constitutes an offer?
  3. What constitutes an acceptance of an offer?
  4. What is consideration?
  5. What are conditions?
  6. What are limitations?
  7. What are warranties?
  8. What is a breach?
  9. How are contracts interpreted?

Ethics for the Insurance Professional

The Course covers the following:

  1. What is ethics?
  2. Kant and the categorical imperative.
  3. Hegel and ethics and that the ethical life is a concept of freedom.
  4. Virtue ethics.
  5. Metaethics.
  6. The Golden Rule.
  7. Applied ethics.
  8. Uberrimae Fidei.
  9. Understanding the concept of Uberrimae Fidei.
  10. How an insurer insists on insurer-wide ethical behavior.
  11. How an insurer acts ethically.

What is the Problem with Fraud?

The Course covers the following:

  1. What is insurance fraud?
  2. Insurance fraud and the tort of bad faith.
  3. Insurance fraud and the evidence of good faith and fair dealing.
  4. The red flags of fraud.
  5. The tort of Insurance Fraud.
  6. The crime of insurance fraud.
  7. Obligations of insurers when insurance fraud is suspected.

Interviewing Techniques for the Insurance Professional

The Course covers the following:

  1. What is the interview?
  2. When is the interview a scientific exercise?
  3. When is the interview an art form.
  4. What is the purpose of the insurance interview?
  5. How does the interviewer prepare?
  6. What is important about body language?
  7. How does the interviewer obtain control of the interview?
  8. Obligations of insurers when insurance fraud is suspected.

Investigation of a first party property Insurance Claim

The Course covers the following:

  1. How a claim is investigated.
  2. The obligations of the insured to the insured who presents a claim.
  3. The obligation to present to the insurer relevant documents.
  4. The obligation of the insurer to review and analyze relevant documents.
  5. The need for an agreed scope of loss.
  6. The preparation of the statement of loss.
  7. The preparation and evaluation of the sworn statement in proof of loss.
  8. The facts and investigation results that must be included in the adjuster’s reporting.
  9. The public adjuster and his or her duties to the insured and the insurer.
  10. The need to establish that conditions have been met.

The creation of a Scope, Statement and proof of loss.

The Course covers the following:

  1. How a claim is adjusted.
  2. The obligations of the insured to the insurer to agree on a scope of loss.
  3. The obligation of the adjuster to take the scope of loss and value all of the damage.
  4. The obligation of the insurer to review and analyze relevant documents.
  5. The need for the adjuster to prepare a statement of loss to summarize the findings about coverage and the extent of loss.
  6. The use of the statement of loss to reach agreement with the insured as to the amount of loss and claim.
  7. That after agreement is reached a sworn proof of loss is prepared for the signature of the insure after which payment follows.

The Duties of an Insured Presenting a First Party Property Claim

The Course covers the following:

  1. The duties a policy of first party property insurance imposes on the insured.
  2. The duties are basically a requirement that the insured fulfill all policy conditions.
  3. The use of an “appraisal” to resolve disputes over the amount of loss.
  4. The “Concealment, Misrepresentation, or Fraud” condition of the policy and how the insured can avoid its use to defeat its claim.
  5. The hazard faced by an insured who fails to fulfill the conditions of the policy.
  6. The need of the insured to prove his or her loss.
  7. The use of a public insurance adjuster.
  8. How the covenant of good faith and fair dealing assists the insured who does not fully comply with policy conditions.

The Insurance Examination under Oath

The Course covers the following:

  1. The duties of an insured to submit to an examination under oath.
  2. The duties of an insured to submit documents that establish or support the claim.
  3. The fact that the examination under oath condition is a condition precedent to indemnity.
  4. That the examination under oath condition is hoary with age and has been an honored part of the policy list of condition that must be obeyed.
  5. That any false statement at examination under oath is sufficient to allow the insurer to void coverage.
  6. That the named insured or any person who is an insured must submit to examinations under oath.
  7. That he purpose of a Cooperation Clause is to enable the insurer to obtain all knowledge and facts concerning the cause of the fire and the loss involved while the information was fresh in order to protect itself from fraudulent and false claims.

Insurance Fraud Prevention

The Course covers the following:

  1. The use of investigators to gather evidence establishing that a fraud is being attempted.
  2. The various types of fraud attempted against first party property policies.
  3. Understanding the staged accident.
  4. Understanding the use of paper property.
  5. How to discover an arson for profit.
  6. How to prove that an insured is involved in an arson for profit.
  7. How to discover health insurance fraud.
  8. How to recognize professional conspiracies.
  9. How to recognize fraud in the Legal Profession.
  10. How to act in good faith and fair dealing with regard to insurance fraud.

Compliance with Special Investigation Unit Regulations

The Course covers the following:

  1. All of the Special Investigation Unit Regulations imposed by – as an example – the California regulations.
  2. The need to train integral anti-fraud personnel in how to recognize potential insurance fraud.
  3. The need to create a special fraud investigation unit.
  4. Training by the special investigation unit.
  5. Training of all claims personnel in recognizing insurance fraud.
  6. How to train claims personnel to recognize the red flags of fraud.
  7. Understand the function of an SIU.
  8. Statutes that require a fraud investigation unit or SIU.
  9. Understand the Insurance Fraud Prevention Acts.
  10. Learn about immunities provided to fraud investigators.
  11. Learn the red flags of fraud.

Compliance with Good Faith Settlement Practices Regulations

The Course covers the following:

  1. All of the Good Faith Claims Settlement Practices Regulations.
  2. The California Regulation are a model for settlement practices regulations across the country.
  3. The Regulations were created to allow insurers to understand the minimum claims handling conduct to conform to the Fair Claims Settlement Practices.
  4. The Regulations were designed to punish an insurer who failed to treat an insured with good faith and fair dealing.
  5. The regulations do no provide an exclusive definition of all unfair claims settlement practices.
  6. The meaning and practice of a claims investigation.
  7. How policy terms and conditions are explained to an insured after a loss.
  8. The duties imposed on claims personnel.
  9. Standards for Prompt, Fair and Equitable Settlements
  10. Standards for Prompt, Fair and Equitable Settlements of various types of insurance.
  11. Whether the State Department of Insurance Has Power to change the meaning of a statute.

Rescission – An Equitable Remedy

The Course covers the following:

  1. An explanation of the equitable remedy of rescission.
  2. How rescission can be used as a means to defeat insurance fraud.
  3. The historical basis of the equitable remedy of rescission.
  4. The elements required to prove it is appropriate to rescind a policy of insurance.
  5. What an insurer must prove to rescind a policy of insurance.
  6. How to detect the difference between a true and false representation.
  7. How to determine that a misrepresentation or concealment is material.
  8. What must be done to rescind a policy of insurance.
  9. A review of particular court decisions that resulted in an effective rescission.
  10. A discussion of claims of post loss underwriting and why it is an oxymoron.
  11. What an insurer must do before electing to rescind a policy of insurance.

The Obligations of a public insurance adjuster

The Course covers the following:

  1. The licensing of a public insurance adjuster.
  2. The reason for the existence of public insurance adjusters.
  3. How a public insurance adjuster is remunerated.
  4. The difference between a public insurance adjuster and an independent insurance adjuster or an insurance company employed adjuster.
  5. The ethical requirements imposed by the National Association of Public Insurance Adjusters.
  6. The service(s) provided by public insurance adjusters.
  7. How a person can be licensed as a public insurance adjuster.
  8. What a public adjuster may not do.
  9. How a public adjuster helps an insured prepare and present a claim to an insurer.
  10. Why the public adjuster should always be reasonable, professional, honest, forthcoming, prompt and knowledgeable.
    17. Wrap Up
    a. The course that summarizes and wraps up the Preamble and 15 courses in the program where a necessary asset to every business and every insurer.
    i. The Course covers the following:
    (1) The ability to work with management to assist in what is necessary to deal with an insurance adjuster in presenting a claim to the insurer.
    (2) Determine if the business needs, to deal with a claim, the assistance of claims counsel, a public insurance adjuster, or an insurance consultant.
    (3) Explain to management its rights, duties, and obligations with regard to a policy of insurance.

© 2020 – Barry Zalma

The Master of Property Claims Program is available for a live presentation by Barry Zalma or as an on-line program. If you are interested in a live presentation contact me by e-mail or at 310-390-4455.

As the author, Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 50 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created a library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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