Business Insurance Why insurance company need to Investigate Loss that ocured?

[Mataracy]

On the receipt of the notice and details of loss, the insurer may wish to investigate the loss. This is to ascertain whether the loss actually occurred and to know whether it falls within the scope of the policy cover or not. Thus, a thorough investigation may be necessary. In fact, since the insurer is holding the insurances fund on behalf of all policyholders, any payment, therefore should be entirely justified. This will invariably require careful investigation and reasonable proof, both of the insurer's liability and the amount involved (Quantum). However, in as much as the investigation must be thorough the insurer has to expedite action in order not to prejudice the interest of the insured and the efficiency of the claim process.
Depending on the nature and extent of the loss, the investigation could be carried out either by experienced personnel of the insurer or by an independent loss adjuster. Usually for the simple claims not involving huge amount , the insurer's experienced staff could be used. For the more complex claim involving huge amounts, the insurer would appoint a loss adjust the claim if the claim is valid..

 

[btaliat]

I have a funny of story of someone that insured his car with the aim that the car may got spoil soon due to the fact that the product is not that durable. Unfortunately for him, he has used the car for a year without any fault and he wanted to change it. So he want ahead to intentionally crash it but he was not compensated.

 

[Alexandoy]

In our country there is the job called Insurance Adjuster. His duty is to check on the cost of the damages on how much the insurance company is liable. For example a fire insurance can be free of the damage coverage when the cause of the fire is due to negligence of the owner. The Adjuster also is the one who offers the amount of coverage to the insured.

 

[Wisdom01]

They actually needs to investigate to be sure of the claim before covering for it or they end up in more debts , because there could be fake claims by the insurer and that's why they need to cross check on how the incident or even take place before giving a final decision

 

[btaliat]

People always want to play smart on insurance company and in order not to be outplayed, insurance companies need to step up their games by finding the actual root cause of the incident before they can pay any compensation. This will let the two party her fair treatment without anyone being cheated.

 

[Setho]

The insurance company actually needs to investigate the damage that just happened just so as to know to what extent they are supposed to cover as it is stated in the contract. For example if a road auto crash happens and the fault is very well from the driver of the car they can only cover the damage up to a certain extent.