Chapter 5 - New Questions Flashcards
In what circumstance would a motor policy renewal come into force according to the provided example?
When the insured simply continues to use the car after receiving the renewal notice.
In the case of Danbol Pty Ltd v. Swiss Re International SE (2020), what was the court’s finding regarding the renewal offer?
The insurer’s offer involved a mutual promise rather than a unilateral contract.
In the case where the premium is to be agreed upon later, what type of contract is created?
A binding contract with terms left to be fixed.
Under the Statute of Frauds 1677, what type of contract must be evidenced in writing?
Contracts of guarantee.
What must companies obtain before they can write insurance business in the UK?
A license from the UK regulator for the class or classes of business.
Which of the following best describes the ‘subject matter’ of insurance?
The policyholder’s interest in the physical property.
In the case of Lucena v. Craufurd (1806), why was the interest of the Crown Commissioners in the enemy ships considered insufficient?
They had not yet taken possession of the ships and only had an expectancy.
Which case involved a dispute over insurable interest related to a pub owned by a liquidated company?
Comlex Ltd v. Allianz Insurance Plc (2016).
Which of the following distinguishes insurance from wagering?
Insurance requires full disclosure from both parties, while wagering does not.
Why might the requirement for insurable interest to exist at the time of the contract but not necessarily at the time of the claim be beneficial for life insurance policies?
It allows for greater flexibility in transactions and transfers involving life policies.
Which legislation repealed the Gaming Act 1845 concerning insurance policies?
Gambling Act 2005
What does the Gambling Act 2005 stipulate about insurance policies relating to gambling?
The fact that a contract relates to gambling shall not prevent its enforcement.
What does Section 335(2) of the Gambling Act 2005 indicate regarding rules preventing enforcement of contracts?
It allows enforcement of contracts unless specifically related to gambling.
What happens if an insurance policy is void due to a lack of insurable interest?
The policyholder is not entitled to any return of premiums.
In which case was the insurance policy held to be void for lack of insurable interest, and the policyholder was unable to recover premiums?
Harse v. Pearl Life Insurance Co. (1904)
What principle is upheld in property insurances even if the Gambling Act 2005 might suggest otherwise?
The principle of indemnity, which limits recovery to the actual loss incurred.
In which type of policies is it common for insurers to agree to dispense with the need to prove an insurable interest?
PPI (Payment Protection Insurance) policies in the marine market
What is a common reason for an employer to take out a ‘keyman’ or ‘keywoman’ insurance policy?
To cover the cost of replacing a key employee in case of their death.
What is the extent of a mortgagee’s insurable interest in the mortgaged property?
The outstanding amount of the loan
Which of the following best describes the insurance responsibility under a leasehold arrangement?
Both the leaseholder and freeholder should agree on who will arrange insurance.
What was the outcome of the Supreme Court decision in the FCA test case concerning COVID-19 related business interruption claims?
The Court found that 14 out of 21 policy wordings responded to the claims
In the context of negligence, what must be demonstrated between the breach of duty and the harm caused?
Causation
What type of liability insurance would cover a surgeon who inadvertently leaves a tool inside a patient?
Professional indemnity insurance
What was the significance of the case Dalby v. The India and London Life Insurance Company (1854)?
It dealt with the insurable interest in the reinsurance of a life policy
In the context of reinsurance, who typically does not have a right or interest in the reinsurance, according to the Marine Insurance Act 1906?
The original policyholder
