Which of the following is NOT a basic activity in claims handling?

• A. Filing a suit against the insured
• B. Investigation to establish coverage, liability, and damages
• C. Evaluation to determine fair payment
• D. Negotiation of a settlement

Answer: (A)

Focusing on what typically happens during claims handling, the main tasks are to investigate the claim to determine coverage, liability, and damages; evaluate what would be a fair payment; and negotiate a settlement with the other party. Filing a suit against the insured belongs to the litigation process rather than the routine claims-handling flow. It usually happens only after investigation, coverage determination, and settlement efforts have been exhausted, and it’s typically handled by legal counsel rather than as a standard adjuster task. So the activity that isn’t part of basic claims handling is initiating a lawsuit against the insured.