Texas Adjuster Practice Test

What action should be taken if damages are identified during the claim’s investigation?

1. Report only to the insurer

2. Record and assess for subrogation

3. Compute depreciation immediately

4. Create a settlement proposal

The correct answer is: Record and assess for subrogation

When damages are identified during a claim’s investigation, it is essential to record and assess for subrogation because this process involves determining whether another party may hold some responsibility for the damages incurred. By documenting the extent of the damages thoroughly, the adjuster can evaluate if the insurer has the right to pursue reimbursement from the responsible party. This step is crucial in protecting the insurer’s financial interests and ensuring that the claim is handled effectively. The assessment for subrogation must occur early in the claims process as it informs subsequent actions—such as whether to pursue recovery from another party and how to quantify the amount owed. This proactive measure not only aids in the settlement process but also maximizes the claim's effectiveness, potentially reducing the overall loss experienced by the insurer. Other actions, such as reporting only to the insurer, computing depreciation, or creating a settlement proposal, are important in their own contexts but do not focus on the potential for recovery from third parties. These alternatives lack the comprehensive strategy involved in addressing liability and recovery during the claims process.