Claims Investigation Checklist

Steps a claims adjuster runs from FNOL through coverage decision on a first-party property or liability claim. Covers intake, evidence gathering, fraud screening, and documented decision rationale.

Use this workflow
1

FNOL Intake and Assignment

  1. Log the FNOL in the claims system

    • Open the claim in ClaimCenter (or your PAS), assign a claim number, and capture loss date, loss location, reported-by party, and reported cause of loss. The reported cause drives the coverage path — get it from the reporter's words, not the adjuster's interpretation.

    Collects text Collects date Collects list
  2. Send the statutory acknowledgment letter

    • Acknowledgment windows vary by state. Texas Insurance Code Chapter 542 requires acknowledgment within 15 business days of FNOL on a first-party claim; missing it triggers 18% statutory interest plus attorney's fees. Use the state-specific letter template from the compliance library.

  3. Verify policy is in force on the loss date

    • Pull the dec page for the policy period covering the loss date. Watch for mid-term cancellations, lapses for non-payment, and reinstatements with gaps. For claims-made policies, verify the retroactive date precedes the alleged act.

    Collects list
  4. Run OFAC screening on claimant and payees

    • Screen claimant, named insured, and any known assignees (body shops, contractors, medical providers) against the OFAC SDN list. Re-screen at payment — parties can be added mid-claim. Document the screening result in the file.

2

Coverage Analysis

  1. Read the policy form against the reported facts

    • Read the insuring agreement, exclusions, and endorsements as filed — do not rely on AMS-summarized coverage. Note any anti-concurrent-causation language for property claims and any prior-acts or retro-date conditions for claims-made forms.

  2. Identify coverage issues requiring an ROR

    • Flag exclusions, late-notice issues, prior-knowledge concerns, or coverage trigger ambiguity. A reservation of rights protects the carrier's ability to deny later while it investigates, and most states require it be specific to the issue — boilerplate ROR language has been rejected by courts.

    Collects list
  3. Issue the reservation of rights letter

    • Cite the specific policy provisions in question and the facts under investigation. Send via tracked delivery and calendar a follow-up within 30 days to either lift the ROR or proceed to a coverage position letter.

  4. Set the initial reserve

    • Set indemnity and ALAE reserves based on reported severity and the carrier's reserving philosophy. Calendar the next reserve review per the carrier's cadence (commonly 30/60/90 days). Placeholder reserves left unrevised are a market-conduct exam finding.

    Collects number Collects number
3

Investigation and Evidence

  1. Take the recorded statement

    • Disclose recording at the start — some states are two-party consent, and undisclosed recording makes the statement inadmissible and supports a bad-faith allegation. Cover loss chronology, prior similar losses, and any third parties involved.

  2. Order police, fire, or incident reports

    • Request the official report from the responding agency. Many jurisdictions take 7-21 days to release; calendar a follow-up. The narrative section often contradicts FNOL details and reframes the investigation.

  3. Collect scene photos and damage estimates
    Collects file Collects number
  4. Pull the CLUE and prior loss history

    • Run a LexisNexis CLUE report on the insured and, for auto, the involved drivers and vehicles. Frequency patterns (multiple soft-tissue claims, repeat water damage at the same dwelling) are leading SIU referral indicators.

  5. Assess SIU referral indicators

    • Score the file against the carrier's fraud-indicator checklist: late reporting, recent policy inception, prior similar losses, claimant pressure for fast settlement, missing documentation. Two or more indicators typically trigger SIU referral under the carrier's anti-fraud plan.

    Collects list
  6. Open the SIU referral

    • Submit the referral packet with indicator scoring, recorded statement, CLUE, and any inconsistent documentation. SIU may request an EUO; coordinate scheduling and counsel through the SIU lead, not the line adjuster.

4

Decision and Communication

  1. Reconcile evidence against coverage

    • Build the coverage analysis memo: facts, applicable provisions, exclusions considered, and how the evidence maps to each. This memo is the file's defense in any later bad-faith or market-conduct review.

  2. Evaluate subrogation potential

    • If a third party caused or contributed to the loss, put them on notice within the state's statutory window — often 6 months. Missing the notice waives recovery and shows up as a finding at the next market-conduct exam.

  3. Document the claim decision

    • Record the decision, settlement amount or denial basis, reviewer notes, and approval signature in the file. For Texas first-party claims, decision must be communicated within 15 business days of receipt of all requested information per Chapter 542.

    Collects list Collects paragraph Collects signature
  4. Notify excess carriers if reserve crosses 50%

    • Most excess policies require notice of any matter reasonably likely to involve the excess layer; carriers commonly use 50% of the primary as the practical trigger. Late notice is a coverage-condition violation that excess markets do enforce.

  5. Send the coverage position letter to the insured

    • For denials and partial denials, cite the specific policy language and include the state-required appeal-rights notice. Use tracked delivery. For payments, attach the release form and confirm payee matches the OFAC re-screen.