Chapter 5: Legal and Regulatory Requirements Flashcards
Define ‘breach of warranty’
When a compulsory insurance has a breach of duty of fair representation
Define ‘compensation’
Define ‘controlled function’
Define ‘damages’
Define ‘liability insurance nuclear reactirs’
Define ‘marine pollution liability insurance’
Define ‘non consumer contract’
Contract done for business reasons
Define ‘compulsory insurances’
Insurance which is compulsory in England and wales. Either for private individuals or professions and businesses.
Why are certain forms of insurance compulsory?
To provide funds for compensation and in response to national concerns
What act made third party motor compulsory insurance?
Road traffic act 1998
What act made employers liability compulsory insurance?
Employers liability (compulsory insurance) act 1969
Who does employer’s liability cover?
employees including subcontractors
What act made public liability insurance compulsory for riding schools?
Riding establishments act 1970
What do all compulsory insurances in the UK have in common?
They are liability, not property.
What can an insurer do if there has been a breach or bad faith on a compulsory line of insurance?
Not much. They have to pay out, but then can chase the insured for the money.
What are compulsory insurances in the USA?
Workers compensation, motor insurance for commercial vehicles. And some states have short term disability insurance for employees
What is compulsory insurance in Turkey?
Property owners must be insured against earthquakes, and motor.
What is compulsory insurance in Australia?
Third party motor
What is compulsory insurance in Germany?
Third party liability for any event in which a German court may consider you negligent.
What does the Consumer Rights Act 2015 say about unfair terms?
An unfair term is not binding on the consumer but if they want to rely on that term they can choose to do so.
Define ‘unfair contract terms’
A term which causes a significant imbalance in the parties rights and obligations under the contract to the detriment of the consumer.
How can a term avoid being measured as unfair?
Be transparent, expressed plainly, and be legible.
Define ‘consumer contract’
Anyone buying insurance outside of their business, trade, or profession.
What does the Contracts (Rights of Third Parties) Act 1999 say?
Set out when a third party can enforce the terms of a contract. - if they are identified in the contract by name.
Can insurers opt out of the Contracts (Right of Third Parties) Act 1999?
Yes!
Define ‘injuction’
A remedy that the court can award to prevent a party doing something.
Define ‘specific perfomance’
Opposite of an injunction- a court says a party must do something.
Why can the rights of third parties act be excluded in cargo?
Because cargo insurance often has claims from people who are not the original buyers of insurance.
Define ‘insurance premium tax’
A tax on general insurance premiums in the UK. the standards rate is 12%, higher rate is 20%.
What is the senior managers and certification regime?
A regime that applies to both brokers and intermediaries, introducing a regular you framework.
What are the three parts of SM&CR?
Senior managers regime, certification regime, rules of conduct.
What roles are included in SM&CR Senior mangers regime?
Head of key business area, group entity senior manager, significant responsibility function? And executive and non executive directors.
What are the first tier of conduct rules in SM&CR?
Act with integrity, act with skill, care, diligence, be cooperative with regulators, treat customers fairly, observe standards of market conduct.
Define ‘approved person’
A person who has been approved to carry out their function.
Define ‘compliance officer’
The person responsible for carrying out compliance oversight.
Define ‘money laundering reporting officer’
Someone who checks there is no money laundering. Regulated by PRA and FCA.
What is IPT on extended warranty insurance?
20%
What is a recital clause?
This is the preamble, it introduces and provides background info to why the contract is being drawn up
