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Bodily Injury Claims: Practice Questions & Explanations

3 Insurance Adjuster questions on bodily injury claims, each with a worked explanation citing the source handbook.

Source: NAIC adjuster content outlines and standard insurance industry training materials.

Reviewed by Jordan Morley, Editorial Lead at 247SimpleTests. Written by the 247SimpleTests Editorial Team from the official source material cited on every question.

Why this topic matters

Bodily injury claims turn on medical documentation, causation and the valuation of pain and suffering and lost wages — the areas adjusters are tested on most heavily because the dollar amounts and the litigation risk are highest.

Below are every bodily injury question in our Adjuster bank. Read each question, try to answer before reading the explanation, and use the source citations to look up anything you want to verify in your state's adjuster handbook.

1. What is the 'collateral source rule'?
  1. A An insured cannot recover from both their own insurer and a third-party insurer for the same loss
  2. B Adjusters must check all collateral sources before paying
  3. C The at-fault driver's insurer is always the primary source
  4. D A plaintiff's recovery is NOT reduced because they received compensation from an independent source (their own health insurance, disability benefits, etc.)

Explanation

The collateral source rule (adopted in most states) holds that a defendant's liability is not reduced because the injured party received compensation from an independent source (their own health insurance, etc.). This can affect bodily injury negotiations significantly — the at-fault party cannot offset their liability by pointing to the victim's own insurance payments.
Source: Adjuster Exam, Collateral Source Rule

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2. A claimant's medical treatment for a soft tissue injury lasted 3 months. They have $4,500 in medical bills and missed 2 weeks of work at $1,000/week. They also claim pain and suffering. How does a bodily injury adjuster approach a fair settlement value?
  1. A Medical specials + wage loss + general damages (pain and suffering) — general damages are typically calculated as a multiplier of medical specials (1.5x-4x for soft tissue; higher for severe injuries), adjusted for liability (if any comparative fault) and specific case factors
  2. B Medical bills + wage loss only
  3. C Pay only the medical bills
  4. D Refuse all soft tissue claims

Explanation

Bodily injury settlement calculation: SPECIAL DAMAGES (economic): Medical bills $4,500 + Lost wages $2,000 = $6,500; GENERAL DAMAGES (pain and suffering): Multiplier method: soft tissue, short duration (3 months), full recovery → 1.5x-2x special damages = $9,750-$13,000.

Total settlement value range: $6,500 + $9,750 = $16,250 to $6,500 + $13,000 = $19,500.

Adjustments: Liability (was insured 100% at fault?); pre-existing conditions; quality of medical treatment; gap in treatment; subjective complaints vs objective findings; Litigation exposure (is claimant represented? Venue?).

Settlement range: File a reserve that accounts for the full range of potential jury verdict plus litigation costs; offer settlement at the fair end of the evaluated range. Note: multiplier method is a heuristic — each case has unique facts.

Source: Insurance Adjuster — Bodily Injury, Settlement Valuation

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3. What is 'medical payments coverage' (MedPay) and how does it differ from bodily injury liability?
  1. A MedPay is a first-party no-fault coverage that pays medical expenses for the insured and passengers regardless of fault — it does not require proving the insured was liable; BI liability is a third-party coverage that pays damages to others when the insured is at fault
  2. B BI pays for medical bills; MedPay pays for pain and suffering
  3. C They are the same coverage
  4. D MedPay only covers the driver, not passengers

Explanation

MEDPAY vs BODILY INJURY LIABILITY: MEDICAL PAYMENTS (MedPay): First-party coverage — pays for the INSURED and passengers in the insured vehicle; No-fault — pays regardless of who caused the accident; Covers medical expenses only (not pain and suffering, lost wages); Lower limits (typically $1,000-$10,000); BODILY INJURY (BI) LIABILITY: Third-party coverage — pays for OTHERS injured when the INSURED is at fault; Requires fault determination; Pays all bodily injury damages including medical, lost wages, and pain and suffering; Higher limits (state minimums often $25,000-$100,000+);

Adjuster relevance: MedPay claims are handled as first-party — insured cooperates, no fault determination needed; BI claims require liability investigation; some states have PIP (Personal Injury Protection) instead of or in addition to MedPay — PIP is broader (includes lost wages) and may have coordination of benefits with health insurance requirements.

Source: Insurance Adjuster — Coverage Types, MedPay vs BI Liability

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