What does adjustment refer to in insurance claims?

Adjustment in the context of insurance claims refers specifically to the actions taken by the insurer to either accept or deny a claim. This process involves investigating the claim to assess its validity, reviewing the details submitted by the policyholder, and determining whether the circumstances of the loss are covered under the terms of the insurance policy.

During the adjustment process, adjusters may gather evidence, speak to witnesses, and evaluate the damages to arrive at a conclusion. This is a critical component of the claims process as it directly impacts whether the insured will receive compensation for their loss and how much they can expect.

While other aspects of insurance such as calculating premiums or evaluating the effectiveness of a policy are important to the overall insurance framework, they do not pertain specifically to the adjustment of claims. The evaluation of a loss is a stage in the adjustment process but does not encompass the entirety of what adjustment means in this context. Thus, focusing on the actions related to the acceptability of claims accurately reflects the definition of adjustment in insurance.