Unfair claims settlement practices prohibit refusing a claim without what?

• A. Conducting a reasonable investigation
• B. Paying immediately
• C. Citing the policy
• D. Not investigating at all

Answer: (A)

Unfair claims settlement practices require that a claim not be refused without a reasonable investigation. Before denying or denying payment, the insurer should gather facts, review the policy provisions, verify coverage, and obtain any needed documentation (like medical records or proof of loss) to make a well-supported decision. This keeps the determination based on complete information rather than guesswork or bias. Paying immediately isn’t mandated as part of the denial process, and simply citing the policy doesn’t replace the need to investigate. Not investigating at all would also violate this principle, but the standard phrase used to describe the prohibited action is refusing a claim without conducting a reasonable investigation.