Unfair Claims Practice

AAA

DEFINITION of 'Unfair Claims Practice'

The improper avoidance of a claim by an insurer or an attempt to reduce the size of the claim. By engaging in unfair claims practices an insurer tries to reduce its costs. However, this is illegal in many jurisdictions.

INVESTOPEDIA EXPLAINS 'Unfair Claims Practice'

The National Association of Insurance Commisioners (NAIC) has created legislation that states that claims be handled fairly and that there is clear communication between the insurer and the insured. Because of this legislation, many states have implemented unfair claims practice laws.

RELATED TERMS
  1. Fake Claims

    The term fake claims refers to insurance claims that are made ...
  2. National Association of Insurance ...

    A nationwide organization whose main responsibility is to protect ...
  3. Insurance Claim

    A formal request to an insurance company asking for a payment ...
  4. Contract Holder

    An individual or organization who owns the rights to a debt or ...
  5. Insurance

    A contract (policy) in which an individual or entity receives ...
  6. Basket Retention

    An insurance policy that covers exposures to several different ...
Related Articles
  1. Home & Auto

    Is Your Insurance Company Going Belly Up?

    When insurance companies go bankrupt or face financial difficulty, it's bad news for policy holders.
  2. Home & Auto

    Insure Your Future With A Career As An Actuary

    If you've got excellent math skills, they can add up to a lucrative career as an actuary.
  3. Insurance

    Will Filing An Insurance Claim Raise Your Rates?

    An accident can mean higher insurance costs - even if it wasn't your fault.
  4. Professionals

    Introduction To The Continuing Claims Report

    This weekly economic release contains important information concerning unemployment levels and insurance.
  5. Options & Futures

    5 Life Insurance Questions You Should Ask

    Confused about $1 million dollar insurance advertising claims? Decide whether they'll pay off for you.
  6. Options & Futures

    Is short selling a form of insurance?

    Explore short selling and put options. Learn how put options may be used as insurance to protect positions, and costs associated with using this method.
  7. Bonds & Fixed Income

    How Diaspora Bonds Work

    Developing and emerging nations with sizable populations living overseas are using diaspora bonds to raise financing from emigrants.
  8. Economics

    The Economic Impact of Better US-Cuba Relations

    We examine what the normalization of relations between the US and Cuba will mean for the two countries' economies.
  9. Insurance

    How to Use a Waiver of Subrogation

    A waiver of subrogation means that a party to a contract waives the right to allow someone (usually an insurance company) to sue the other party to the contract in case of a loss.
  10. Savings

    I’m twice divorced –-can I still collect spousal benefits?

    Unsure if you’re eligible for spousal benefits if you’re divorced –more than once? Rob Kron from Blackrock gives a simple answer.

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center