Hawaii Insurance Adjuster License Practice Exam

When must medical payment expenses under the commercial general liability policy be reported?

1. Within 30 days of the accident

2. Within 6 months of the accident

3. Within one year of the accident

4. Within 18 months of the accident

The correct answer is: Within one year of the accident

The requirement to report medical payment expenses under a commercial general liability policy generally aligns with a one-year time frame following the accident. This regulation ensures that insurers are notified promptly, enabling them to conduct timely investigations and manage claims effectively. A one-year reporting period strikes a balance between providing sufficient time for victims to seek medical attention and submit claims while also protecting the insurer's interests in terms of being able to gather relevant information and evidence related to the incident. Shorter time frames, such as 30 days or 6 months, may not provide enough leeway for claimants who might not immediately realize the extent of their injuries or the necessity of medical expenses. Options extending beyond one year, such as 18 months, typically introduce uncertainty and complications into the claims process, potentially impairing the insurer's ability to verify claims and manage liability accurately. Hence, the one-year requirement serves as a useful guideline in the administration of commercial general liability insurance policies.