State RegulationsTN specificDifficulty 2/5
Which of the following practices is included among Tennessee's unfair claims settlement practices?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
T.C.A. § 56-8-105, implemented with Dept. Rule 0780-01-05, lists unfair claims settlement practices that include misrepresenting pertinent facts or policy provisions, failing to acknowledge and act promptly upon communications, and denying claims without conducting a reasonable investigation. Denying without investigation is expressly in the statute's catalogue, while the other choices describe ordinary, lawful claims handling.
Why the other options are wrong
- A) Prompt, fair settlement after reasonable investigation is the conduct the statute encourages, not an unfair practice.
- B) Taking a recorded statement during a routine investigation is a standard investigative tool, not a prohibited act.
- D) Seeking legal guidance on a complex coverage issue is prudent claims handling, not an unfair settlement practice.
Memory hook
Investigate before you deny — Tennessee's claims statute demands it.