Chapter 4 Flashcards
Which legislation sets out the layout and content of a certificate of motor insurance?
The Motor Vehicle (Third Party Risks) Regulations 1972
What is a ‘Form A’ motor certificate?
Where the registration number is stated on the certificate (sometimes referred to as a ‘specified certificate’)
What is a ‘Form B’ motor certificate?
Where the vehicle(s) are referred to but not specifically identified (sometimes referred to as an ‘unspecified’ or blanket certificate)
Which legislation facilitated the electronic issue of motor certificates?
The Motor Vehicles (Electronic Communication of Certificates of Insurance) Order 2010
If a cover note needs to be prepared manually, it will usually have the original (top copy) and three additional copies. What happens with all of the copies?
The top copy is given to the policyholider, another copy is sent to the insurer, another is retained on the intermediary’s file and the final one is retained in the book for audit purposes
How long must a certificate be retained for?
12 months
Which documents make up the contract of motor insurance?
- The proposal form/statement of fact
- The certificate
- The policy booklet
- The schedule
Why would an insurer request the proposer’s drivers licence number?
In order to obtain a history of convictions from the DVLA via the ‘My Licence’ system
If a proposer has a medical condition that requires them to notify the DVLA, what driving restrictions can they impose?
None greater than the licence restrictions imposed by the DVLA
Who does the Data Protection Legislation apply to?
All persons in the UK who process personal data other than for domestic purposes
What information does the Data Protection Legislation apply to?
Personal data. Any information from which a living individual can be identified, either directly or indirectly
Personal data must be processed in accordance with the seven Data Protection Principles. What are they?
- Lawfulness, fairness and transparency.
- Purpose limitation.
- Data minimization.
- Accuracy.
- Storage limitation.
- Integrity and confidentiality.
- Accountability.
To whom must organisations report data breaches?
The Information Commissioner’s Office
What fines may the ICO levy for the most serious data breaches?
£17.5m or 4% of the annual global turnover if higher
What is the Preamble/Recital clause in a policy booklet?
It sets out the basis of the contract - usually one of indemnity
What does the ‘Operative Clause’ section of a policy booklet outline?
The cover offered under the section in question
What cover is available for war, invasion, act of foreign enemy, hostilities etc.?
None, although they will provide cover insofar as they are required to do so to meet the requirements of the road Traffic Acts.
The government makes special arrangements in the event of war.
When would damage as a result of a riot or civil commotion be covered under a motor insurance policy?
When is occurs in the UK, excluding Northern Ireland
Are nuclear risks covered on a motor insurance policy?
No, the government has made provision for nuclear risks and as a result, they are excluded from motor insurance policies
When is pollution covered on a motor insurance policy?
When they are directly caused by a sudden identifiable or unintended and unexpected incident
What are the usual basic territorial limits listed in the preamble to the policy?
Great Britain, Northern Ireland, Channel Islands and Isle of Man
What could be describes as a guide to the pertinent aspects of the cover granted under the terms of the policy?
Insurance Information
Why would an insurer ask a policyholder to not make an admission of liability in respect of an incident?
It may weaken the insurer’s position with regard to any third party claim
What does the ‘subrogation’ condition allow an insurer to do?
Take over and deal with the defence of settlement of any claim and pursue recovery. It is necessary for anyone claiming cover under the policy to provide any assistance or information required
If a claim is accepted for loss or damage from the policyholder, but the amount to be paid cannot be agreed, who will the claim be passed to?
An arbitrator who must have made a decision before legal action can be taken against the company
When should a commercial vehicle policyholder inform his insurers of a motoring conviction?
As soon as practicable. Unlike private car policies, commercial vehicle policies have a continuing duty of disclosure
How is the FOS funded?
A general levy paid by all firms and case fees payable by the firm to which the complaint relates
What are the main functions of a temporary covering note?
- To provide the policyholder with the main details of the cover granted while the
permanent documents, including the policy, itself, are prepared. - To act as a temporary certificate of insurance which complies with the Road
Traffic Act.
What is the purpose of the notification condition in a policy?
The notification condition requires the policyholder (or personal representatives) to
notify the insurer of any incident which could lead to a claim under the policy
Why is pollution excluded for motor policies unless it is caused by a sudden, identifiable, unintended and unexpected incident?
Often, pollution occurs gradually and it may be a number of years before its
consequences come to light. Such a long tail risk is not suitable for motor insurance.
How long to commercial policyholders have to inform their insurer of a change/removal/addition of a vehicle if using a Form B certificate?
14 days
