What is implied when the insurer receives written notice of a claim prior to payment?

When an insurer receives written notice of a claim prior to payment, it may limit the insurer's liability. This implies that upon receiving notice, the insurer has the opportunity to investigate the claim and assess its legitimacy and extent. By receiving notice, the insurer can identify any potential obligations or limits set forth in the policy regarding coverage. This notification can establish the scope within which the insurer may be liable for loss or damage, ensuring that they do not underwrite excessive claims without proper evaluation. It also helps protect the insurer from unexpected claims and potentially fraudulent situations, as it prompts them to confirm coverage terms and conditions related to the reported claim.

In this context, it’s important to recognize how timely notice affects the insurer’s responsibilities and obligations according to the specific terms of the insurance policy.