Common use of CLAIM SETTLEMENTS Clause in Contracts

CLAIM SETTLEMENTS. THE REINSURER agrees that THE COMPANY will use its standard claim practices and guidelines in the adjudication of all claims on policies reinsured under this Agreement. THE REINSURER has the right to inspect, at the COMPANY's offices, the COMPANY's written claims practices and guidelines. THE COMPANY will promptly notify the REINSURER of its intention to contest, compromise, or litigate a claim involving a reinsured policy. THE COMPANY will also promptly and fully disclose all information relative to the claim. Once notified, the REINSURER will have two business days to notify THE COMPANY in writing of its decision to accept participation in the contest, compromise, or litigation. If the REINSURER has accepted participation, THE COMPANY will promptly advise the REINSURER of all significant developments in the claim investigation, including notification of the initiation of any legal proceedings against THE COMPANY in response to denial of the claim. If the REINSURER does not accept participation, the REINSURER will then fulfill its obligation by paying THE COMPANY its full share of reinsurance, and will not share in any subsequent reduction or increase in liability.