Los Angeles Claims Adjuster Property and Causality Practice Exam

Which statement about the Claims-made form is true?

1. It covers claims reported during the policy period

2. It is available at no additional charge

3. It triggers based on when bodily injury occurred

4. It has no retroactive coverage

The correct answer is: It covers claims reported during the policy period

The Claims-made form is designed to cover claims that are reported during the policy period, making this statement accurate. This type of insurance specifically addresses claims for incidents that occur after the retroactive date but must be reported while the policy is in force. The primary purpose of this coverage is to provide clarity and guarantees for both the insurer and the insured regarding when claims can be made, thus creating a direct correlation between the policy in effect and the reporting of claims. In contrast, the other statements about the Claims-made form present elements that do not align with its functions. For instance, the Claims-made form typically incurs additional charges for retroactive coverage, and it does not respond to claims based solely on when a particular event or injury might have occurred; rather, it relies on when the claim is reported. Furthermore, the nature of Claims-made coverage often includes retroactive elements, meaning that while the policy must be current when the claim is made, it can cover incidents that occurred in the past if those incidents fall within the defined coverage period.