Louisiana P&C Adjuster Practice Exam

What type of policy is likely to require verification of loss before processing a claim?

1. Low-risk homeowner's insurance

2. High-value property insurance

3. Basic liability insurance

4. Non-coverage insurance

The correct answer is: High-value property insurance

High-value property insurance typically requires verification of loss before processing a claim due to the significant amounts of money involved and the increased potential for loss situations. Policies covering high-value properties often involve unique assets, such as antiques, art collections, or luxury items, which can be challenging to appraise without adequate verification. This process ensures that claims are well-substantiated and helps guard against fraud, as well as the complexities surrounding the assessment and valuation of the unique items covered in such policies. In contrast, low-risk homeowner's insurance tends to deal with more standard coverage where losses are generally routine and well-defined, thus requiring less stringent verification. Basic liability insurance primarily handles coverage for legal responsibilities and doesn’t typically involve the same level of asset evaluation. Non-coverage insurance is not relevant as it refers to situations where no claim would be processed due to absence of coverage.