What is the term used when payment has been made on a claim?

The term "settlement" is commonly used in the context of insurance claims to refer to the resolution of a claim where a payment has been made to the policyholder or claimant. This payment typically compensates the insured for damages or losses incurred. A settlement indicates that the insurance company and the claimant have reached an agreement that resolves the claim, fulfilling the insurer's obligation under the terms of the policy.

In the insurance industry, a settlement signifies a formal and legally binding conclusion to the claims process, ensuring that the claimant receives financial compensation for their loss or damage. It marks an important stage in the lifecycle of a claim, as it indicates that all necessary evaluations have been completed, and the parties involved have agreed upon an appropriate amount to settle the issue.

Understanding this term is crucial for those involved in auto damage appraisal, as it encapsulates the finalization of the claims process and the financial responsibilities stemming from it.