CH7 - General insurance products

Question 1

Liability insurance

Answer 1

Liability insurance provides indemnity where the insured, owing to some form of negligence, is legally liable to pay compensation to a third party.
Whilst the cover is on an indemnity basis, there may be an excess (payable by the insured) and/or a maximum level of cover provided by the insured.

indemnity = αποζημίωση
Wiki
Liability insurance (also called third-party insurance) is a part of the general insurance system of risk financing to protect the purchaser (the “insured”) from the risks of liabilities imposed by lawsuits and similar claims. It protects the insured in the event he or she is sued for claims that come within the coverage of the insurance policy.
Liability insurance is designed to offer specific protection against third-party insurance claims, i.e., payment is not typically made to the insured, but rather to someone suffering loss who is not a party to the insurance contract. In general, damage caused intentionally as well as contractual liability are not covered under liability insurance policies.
Insurer can also defend the insured. Costs of defend are not included in policy limits.

Question 2

Main types of liability insurance (5)

Answer 2

1. Employer’s liability
2. Motor third party liability
3. Public liability
4. Product liability
5. Professional indemnity

Question 3

Employer’s liability

Answer 3

Perils include accidents in the workplace due to negligence of an employer or employee, exposure to harmful substances / working conditions.

Question 4

Motor third party liability

Answer 4

Perils include motor accidents caused by the insured.

Question 5

Public liability

Answer 5

Perils depend on the type of policy, e.g. dog bites, falling objects.

Question 6

Product liability

Answer 6

Perils include faulty design, manufacture, packaging and misleading instructions.

Question 7

Professional indemnity

Answer 7

Perils depend on the profession of the insured.

Question 8

Property damage insurance

Answer 8

The main characteristic of property damage insurance is to indemnify the insured against loss of, or damage to, their own material property.
Whilst the cover is on an indemnity basis, there may be an excess (payable by the insured) and/or a maximum level of cover provided by the insured. Household contents insurance is frequently written on a new for old basis.

Question 9

Main types of property damage insurance

Answer 9

1. Residential building
2. Moveable property (e.g. contents)
3. Commercial building
4. Land vehicles (e.g. car)
5. Marine craft
6. Aircraft

Question 10

Residential building

Answer 10

Perils include fire, explosion, lightning, theft, storm, flood.

Question 11

Moveable property

Answer 11

Major peril is theft, other perils as per buildings insurance.

Question 12

Commercial building

Answer 12

Perils include fire, explosion, lightning, theft, storm, flood.

Question 13

Land vehicles

Answer 13

Perils include accidental damage, theft.

Question 14

Marine craft

Answer 14

Perils include perils of the sea, fire, jettison, explosion, piracy.

Question 15

Aircraft

Answer 15

Similar perils to marine craft but air based.

Perils include perils of the sea, fire, jettison, explosion, piracy.