In claims handling, which statement about the role of communication is most accurate?

• A. It is optional
• B. It is only with insureds
• C. It is crucial for good-faith handling and resolution
• D. It should be limited to writing only

Answer: (C)

Effective communication is central to claims handling. It ensures good-faith handling and timely resolution by keeping insureds and other involved parties informed about what’s happening, what coverage applies, what information is needed, and what the next steps and timelines look like. Clear, regular updates help set realistic expectations, explain why decisions are made, and prevent surprises that can lead to disputes or allegations of bad faith. Communication isn’t optional; it’s ongoing throughout the process and involves more than just the insured—claimants, medical providers, witnesses, and sometimes defense counsel all rely on timely, accurate information. It’s also not limited to written notices—phone calls, emails, and in-person discussions, when properly documented, are essential to accurately capture facts and decisions.