The insurer's obligation to pay a valid claim is triggered by

• A. After the insured signs the contract
• B. After premium payment is made
• C. After the insurer receives proof of loss
• D. After the policy is issued

Answer: (C)

The obligation to pay a valid claim is triggered when the insured provides proof of loss. This is the point at which the insurer can verify that a covered loss occurred, within the policy’s terms, and determine the amount due (taking into account deductibles and limits). Signing the contract or paying the premium sets up coverage, but payment on a specific claim depends on submitting admissible proof of loss and the claim meeting all policy conditions. After proof of loss is submitted, the insurer reviews the claim, and if it’s valid and covered, pays accordingly.