In insurance, what is the term for a provision that allows the insurer to investigate and settle claims at its discretion?

The correct term for a provision that allows the insurer to investigate and settle claims at its discretion is actually referred to as "Claims handling." This process encompasses how claims are managed, evaluated, and settled by the insurer. It is integral to the insurance policy as it gives the insurer the authority to decide how to proceed with a claim, including the investigation and negotiation processes.

The concept of "Claims handling" highlights the insurer's discretion in determining the validity of a claim, the amount to be paid, and the approach to take regarding the settlement. This provision also protects the interests of both the insurer and the insured by ensuring that claims are handled in accordance with policy terms and conditions.

The other terms do not reflect this provision accurately. The "Adjustment clause" typically refers to specific conditions or stipulations related to modifying or changing the terms of a policy following a claim. "Defense costs" pertain to legal expenses incurred in defending against claims made, which does not encompass the broader claims management aspect. Lastly, "Underwriting provision" relates to the criteria and processes used to determine the acceptability of risks when issuing an insurance policy, rather than how claims are processed after the fact.