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IF2 > Chapter 3- Package > Flashcards

Chapter 3- Package Flashcards

1
Q

Why are package policies sufficient homogeneity of risks

A

Homogeneity of risks refer to the situation where many risks share similar characteristics and follow similar trends

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2
Q

What are the benefits of package policies

A

It reduces administrative work to issue standardised wordings and charge a single premium for all classes. The savings are passed on in the form of reduced premium levels

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3
Q

What are the two options for settlement or household claims

A

Indemnity (or market value) a deduction is made for wear and tear. The amount paid is that required to replace the item with a replacement of the same age and in the same condition

New for old (reinstatement)

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4
Q

What is included under ‘buildings’

A

The private dwelling including garages, sheds, greenhouses and other outbuildings, swimming pools, tennis courts, walls, gates, fences and paths.

I.e anything that can’t be moved

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5
Q

What is covered under buildings on a package policy

A

Fire, lightning, explosion and earthquake

Riot, civil commotion

Storm or flood

Falling trees or branches

Escape of water

Escape of oil

Theft or attempted theft

Impact

Subsidence, ground heaven or landslip

Breakage or collapse of television or radio revering aerials

Accidental damage to drains, pipes, cables

Accidental breakage of glass and sanitary fixtures

Legal fees, architects

Loss of rent

Non automatic extension I.e accidental damage

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6
Q

What are the key exclusions from the cover provided for subsidence, ground heave and landslip under a household buildings policy

A

Normal shrinkage or settlement

Faulty workmanship or design

Demolition or alteration

Coastal or riverbank erosion

Movement of floor slabs

Outside items etc like pools

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7
Q

Under what section are radio and television aerials covered

A

Contents

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8
Q

Are cash and stamps covered under contents?

A

Yes but not part of a stamp collection

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9
Q

What are the perils covered under a contents section

A

Same as buildings except:

Theft or attempted theft of cash, currency, bank notes and stamps generally excluded unless it involves forcible and violent entry or exit

Theft or attempted theft by deception is normally excluded

Theft or attempted theft where the building is lent, let or sub let is excluded unless it involves led forcible and violent entry or exit

Accidental damage cover which may be added

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10
Q

Under contents insurance what is not covered under accidental damage

A

Clothing, contact lenses, money, stamps, coins, medals. Plants, food and drink, sports equipment and bikes

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11
Q

What are the two limits within contents insurance

A

Single article limit (usually 5% of the total contents sum insured or no more than a fixed amount say £1,500)

Valuables limit (usually one third of contents sum insured)

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12
Q

What are the 4 elements of cover that are usually automatically covered under contents

A

Temporary removal- extends to things taken out of the home. Theft or attempted theft is only covered if it’s being taken to a bank, in a building where the insured/ family are temp residing or in the course of removal

Clothing and personal effects- domestic staff minus cash

Accidental breakage

Loss or rent- usually 10-20% of the contents sum insured

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13
Q

Under contents insurance what are the two non automatic extensions

A

Accidental damage to entertainment equipment

Accidental damage whilst in the course of removal

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14
Q

Under contents insurance what are the 4 specific exclusions

A
  1. Property more specifically insured under another policy
  2. Deeds, bonds, documents and manuscripts
  3. Medals and coins
  4. Motor vehicles
  5. Livestock- other than horses
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15
Q

What is the legal liability for buildings under package

A

Liability incurred by the insured as owner of the property under the Defective Premises Act 1972 for faults in property

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16
Q

What is the legal liability for contents under package

A

Protects interest of the insured as:

Occupier rather than owner of the property

A private individual for personal liability

As an employer or domestic employees

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17
Q

Where does legal liability cover under buildings and contents and for how much

A

Cover is for legal liability for accidental injury and damage to property anywhere in the UK for around about £2 million

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18
Q

What is all risks optional extension in respect to household policies

A

Covers personal possessions taken outside the property. Single article limit for unspecified items usually about £100 to £500

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19
Q

What are specified items in respect to all risks cover on household policies and what are the exclusions

A

Anything that exceeds the single valuable article limit.

Exclusions are:

Wear and tear 
Insects or vermin
Corrosion, Rot 
Any process of heating, dyeing, alteration or repair
Mechanical or electoral breakdown 
Scratching, denting, faulty workmanship
Official confiscation
Deeds, bonds, documents
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20
Q

What includes money cover on household policies

A

All risks cover usually covers cash, cheques, postal orders, bankers drafts, postage stamps/ Certs, premium bonds, luncheon vouchers, gift tokens and travel tickets

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21
Q

What does cover relate to on money on household policy

A

Accidental loss of money and a limit it indemnity between £200- £300 applies with an excess of £50

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22
Q

What are the 2 specific exclusions for money cover on household policies

A

Shortages due to error or omission

Losses not reported to the police within 24 hours

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23
Q

What is a standard condition of credit card loss or theft under household

A

Must be reported to the card issuer and police within 24 hours of discovery

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24
Q

What do credit cards cover under household

A

Included cheque cards, cash cards and charge cards as well as credit limit of liability £500

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25
Q

Under household what are the two exclusions for credit card cover

A
  1. Unauthorised use of the credit card by someone in the same household
  2. Beach of the insurers T&C
26
Q

What cover are bicycles covered on on a household policy

A

All risks basis

27
Q

What is the way bicycles are insured on a household policy

A

Either a separate sum insured per cycle or a limit per cycle or between £100 and £500 for all cycles owned by the insured and family

Excess of £25- £50 is typical

28
Q

What are the 3 exclusions of bicycles under household

A

Loss or damage to parts unless the cycle is damaged at least he same time

Use for racing, pace making it trials

Exclude theft in certain circumstances unless in a locked building etc

29
Q

When a whole family is involved in cycling on a household policy what happens

A

Special terms can be agreed as a significant sum to be insured

30
Q

What are the two reasons insurers cover freezer contents on household policies

A

Change in temp due to power failure

Contamination as a result of accidental escape of refrigerant fumes

Limit of indemnity usually £300

31
Q

What are the 4 specific exclusions to freezer contents on a household policy

A
  1. Fire, lightning but or explosion damage
  2. Deliberate restriction of supply by supplier
  3. Wilful or deliberate act of the insured
  4. Damaged after the freezer is old
32
Q

What are the three sections of cover for caravans under a household policy

A

Caravan and equipment- all risks basis

Clothing and personal effects whilst property is in caravan

Liability- legal liability for bodily injury or damage caused by the caravan

33
Q

What are the 5 exclusions to caravans under household

A
  1. Wear and tear
  2. Theft whilst left unlocked or unattended
  3. Hire or reward
    4 business use
  4. Storm of flood damage to an awning
34
Q

What are small crafts

A

Defined as vessels not exceeding 16 feet and with design speeds not exceeding 17 knots

35
Q

What 4 sections of cover are applicable to small crafts under household

A
  1. Accidental loss or damage to craft, machinery and equipment
  2. Personal effects
  3. Salvage charges
  4. Liability to third party and passengers
36
Q

What 3 parts of cover is excluded for small crafts under household

A
  1. Hire and reward

2, liability to injury to employees

  1. Theft of outboard motors gears etc
37
Q

Under sports equipment on household what are the 8 exclusions

A

1, motor vehicles, trailers, caravans and boats

  1. Damage whilst equipment is in use
  2. Living creatures

4 non specialist sports clothing

5 pedal cycles

6 golf balls

7 camping equipment

8 equipment for hazardous pursuits

38
Q

What is covered under personal accident, hospital cash benefit and crediter insurance on household

A

Credit instalment payments or mortgage in the event of redundancy

39
Q

How are horses covered under pets on household

A

Cover includes death from accident sickness or disease, personal accident to the rider, third party liability and damage to horsebox trailer

40
Q

How are cats and dogs covered under household

A 
Vet fees 
Accidental death 
Loss by theft 
Kennel fees
Advertising and reward
Third party liability 
Holiday cancellation
41
Q

Under household what 4 things are covered under legal expenses

A
  1. Recovery costs
  2. Civil defence costs
  3. Prosecution defence costs
  4. Employment dispute costs
42
Q

What are the 4 specific exclusions for legal expenses on a household

A

1, claims relating to events occurring outside GB

  1. Fines and compensation payments
  2. Costs and expenses not agreed by the insurer
  3. Claims arising out of the insurers business
43
Q

What 3 ways for identity fraud section of a household policy provide cover for expenses incurred by the insured in respect of:

A
  1. Administration fees for reapplying for a loan previously refused due to incorrect data at a credit agency
  2. Attendant costs such as loss of earning arising from taking time off
  3. The cost of notarising necessary documentation

Overall limit in region of £12,000

44
Q

How long do travel insurance policies last for

A

Maximum of three months

45
Q

Under a travel policy what are the personal accident benefits

A

Between £10- £20,000 provided for death, loss of eyes or limbs or permanent total disablement following an accident

Death penalty usually reduced for children under 16 years

46
Q

Under travel what are the 4 medical expenses covered

A
  1. Medical treatment such as surgical fees, hospital charges and emergency dental treatment
  2. Additional hotel/ travel expenses
  3. Additional cost of bringing home the patient
  4. Additional expenses of those in the insureds party
47
Q

What is usually the limit for medical expenses under travel

A

£10 million

48
Q

Under travel what are the 5 sections to loss of deposits

A

Death, illness of the insured

  1. Jury service
  2. Unemployment through redundancy
  3. Unforeseen accumulation of work
  4. Theft or fire at home or work
49
Q

Under travel what are the limits for baggage and personal effects and money

A

Between £1,000 to £2,000 with a single article limit of £250

50
Q

What is the limit of indemnity for personal liability under travel

A

£500,000 to £1 million

51
Q

Under delayed baggage on travel what is the period of time to be delayed and what is the sum insured allowed

A

Minimum of 12 hours

£50 per person

52
Q

Under travel how much provides a hospital cash benefits

A

Daily benefit or £10 to £15 subject to a limit of £200 to £600

53
Q

What is travel interruption on a travel policy

A

Failure of public transport to deliver the insured for around £300 per person

54
Q

What is travel delay cover in respect of travel insurance

A

Delay to the aircraft/ ship etc for at least 12 hours

£20 for the first 12 hours and £10 for each 12 hours afterwards

55
Q

What are the 4 optional extensions on travel insurance

A
  1. Failure of tour organiser up to £1,500
  2. Lack of services/ amenities- £20 a day max £200
  3. Loss of passport- £100 to £250 limit
  4. Legal expenses- between £3,000 to £50,000
56
Q

What are the 4 exclusions on travel policies

A
  1. Death, bodily injury caused by drugs or booze
  2. Loss of luggage cause by confiscation
  3. Damage to fragile objects
  4. Terrorism
57
Q

What is the property covered under a package commercial policy

A 
Contents
Stock
Fixtures and fittings
Internal decorations 
Building cover
58
Q

Under package commercial policies what are the 10 risks covered

A
  1. Fire and additional perils
  2. Business interruption
  3. Theft
  4. Money
  5. Glass
  6. Assault
  7. Goods in transit
  8. EL
  9. Public liability
  10. Product liability
59
Q

Under commercial package policies what are the risk limits for money

A

typical limited £1,000 in safe or transit.
£750 under business hours in a locked safe,
after Business hours in insured home £250-£500

60
Q

What are the 3 optional expenses for commercial package policies

A
  1. Refrigerated stock
  2. Business ‘all risks’
  3. Legal expenses

IF2 (15 decks)

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