State RegulationsCA specific✓ Verified · outline & fact-checked · Sep 2026Difficulty 3/5
Under California law, certain insurers are required to maintain a special investigation unit (SIU) whose primary function is to:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A special investigation unit is the insurer's internal team dedicated to detecting and investigating suspicious claims and supporting the prosecution of insurance fraud. Requirements related to SIUs appear in California's anti-fraud statutes, which obligate insurers to maintain programs that identify fraudulent activity and refer cases for enforcement.
Why the other options are wrong
- B) Marketing is a distribution function, unrelated to fraud investigation.
- C) Rate setting is performed by actuaries and underwriters, not fraud investigators.
- D) Financial statements are prepared by accounting and actuarial staff, not the SIU.
Memory hook
SIU = the insurer's fraud squad: sniff out suspicious claims, build the case, protect the pool.