Ch 3 : Contract And Agency Flashcards
The party who brings an action in court against the defendant
CLAIMANT
One of the key documents prompted by the previous regulator , the financial Services Authority ( FSA)
Terms of business agreement (TOBA)
What is an contract
A contract is an agreement enforceable by law between two or more person to do,or abstain from doing, soke act or acts their intention being to create legal relations and not merely to exchange mutual promises.
A contract comes into existence when one party makes an offer which the other accepts???
Unconditionally
What operates as a REJECTION of the original offer.
COUNTER OFFER
When it is said to be acceptance complete if its used via post as the method of communication
Letter of acceptance is posted 📫
A firm must take ensure that a customer is given appropriate information about the policy in good time and in a comprehensible form so that the customer can make what kind of decision
Informed Decision
Policy renewal should be offered how many days in advance.
Good time
In which situation insurer may be able to avoid the contract entirely setting it aside ab initio
Non disclosure or misrepresentation of information by the policyholder
What is agency by agreement ?
Relationship between principal and agent is by consent also known as agency by agreement.
A valid contract must include
Offer & acceptance + consideration
If an independent intermediary completes a property survey for an insurer they would be considered to be an
Agent for the insurer
Nuz and Diana have been told that their insurance policy doesn not have a right to cancel.What type of policy is it?
Travel insurance with a term less than a month
AXA insurance Co has asked one of its agents to carry out a property survey 50 miles away .The agent carries out the survey and charge the mileage costs back to the insurer.The cost will be met because
The agent has implied authority
How can a contract be effective
Acceptance must be the final and unqualified agreement to the offer
Under the insurance act 2015 an insurer may elect to terminate a contract in response to
Fraudulent act
Authority can be
Express or implied
One of the duties of an agent to their principal is a duty of good faith.this means that they must
Not allow their own interest to conflict with their duties towards their principal
Under FCA rules in which situation does the consumer have the right to cancel their insurance policy within 14 days without penalty
Purchase done via telephone or call centre
What should be included in the premium and credit section of an insurer s terms of business agreement (TOBA)
The brokers obligation to release all statutory documentation
An example of a short period contract
Travel insurance
Legally when does a valid contract first come into existence
When an offer is accepted unconditionally
An agent has a terms of business agreement (TOBA) with a principal.What type of authority does this create ?
Express
What is the consideration given by the insurers when an insurance contract is formed
An agreement to pay claims in accordance with the terms of the policy
Under the law of agency what is an undisclosed principal
Someone for whom an agent acts ,while seeming to act on their own behalf
When a policyholder cancels their motor policy mid term ,they ate no longer required to make a statutory declaration or any statement acknowledging the policy has ceased to have effect.Which acts bought about this change in the law.
The Deregulation Act 2015
If a principal has a jointly agreed and legally enforceable written agreement with an agent what type of agency agreement has been established
Agency by consent
an agency agreement between a broker and a policyholder would NOT be terminated by
An insurance claim
What isbthe document called that sets out the basis of the relationship between the intermediate and the insurer
Terms of business agreement (TOBA)
Having insured their car with the same insurer for the last 4 years an insured s next renewal documentation will include
An additional prescribed information encouraging to shop around
What are you least likely to find in terms of business agreement
Reason for the advice provided
Under the distance marketing directive within what period does a customer purchasing home insurance via the Internet have to cancel without penalty
14 days
If suja arranges her bldg insurance via a broker ,the principal in law is
Suja
When contract law is applied ,consideration will normally be
Premium payment
Clients TOBA may well contain
SLA (service level of agreement ) indicating precisely what service are being provided and to what standard.
What is assignment
Assignment is the transfer of rights under the terms of a contract
All TOBAs should be
-be clear and succinct
-reflect the business relationship
-define and allocate responsibilities and rights
-ensure compliance with regulatory or statutory rules
Which authority may b express or implied
Actual authority
Duties of principal
-remuneration
-indemnity
Duties of an agent
-obedience
-personal performance
-due care and skull
-Good faith
-accountability
The legal aspects of insurance are considered in relation to
English law
The English law of contract is essentially a law of
Bargains
An Independent insurance broker acts as the agent of the insurance Co when
The broker has authority from the insurer to handle proposal forms and confirm cover
An agency agreement between a broker and a policyholder would not be terminated by
An insurance claim
Under distance marketing directive within wjat period of time does a customer purchasing home insurance via the Internet have to cancel the policy without penalty
14 days
