Chapter 7

Question 1

Example breach by an insurer VS Insured

Answer 1

Insurer:
Failure to indemnify the insured within a reasonable time

Insured:
Fail to pay the premium

Question 2

Warranty VS Condition?

Answer 2

Warranty - minor term - damages can be claimed

Condition - major term in contract - damages and termination

Question 3

What is an example peril that is not insurable at all?

Answer 3

War

Question 4

What are the two principles of interpretation used by the courts?

Answer 4

Statutory Laws (legislation)
Common Law rules (Layed down in Courts)

Question 5

What adds statutory control to Insurance contracts and wording?

Answer 5

Consumer Rights Act 2015

Question 6

What does the Consumer Rights act 2015 impose?

Answer 6

• When the term has been individually negotiated you can still claim
• You cannot exclude or restrict liability for personal injury, or death from negligence
• no unfair term or notice is binding.

Question 7

Interpretation is generally how for common law and statute?

Answer 7

Statute - literal rule
Common law - ordinary rule

They mean the same thing

Question 8

What does noscitur a sociis mean?

Answer 8

Taking into consideration the context of the word

Question 9

What does ejusdem generis mean?

Answer 9

a general word following a specific word is a “thing of the same kind”

Question 10

What is the contra Proferentum rule?

Answer 10

Where two meanings, the court goes against the one who proposed it

Question 11

How do the courts deal with inconsistencies?

Answer 11

IF handwritten, the latter takes precedence

If the policy document is issued later, the later document takes precedence

An express term over rules an implied term

Question 12

What happens if there is not exact compliance with a warranty?

Answer 12

Insurance is suspended until the warranty is complied with (Insurance Act 2015).

Question 13

Condition precedent to contract VS precedent to liability

Answer 13

Contract: policy will not come into effect if the insured fails to comply

Liability: Non compliance allows the insurer to discharge themselves from liability.

Question 14

Example of collateral conditions?

Answer 14

minor terms and breach does not stop a claim

Question 15

What other types of clauses do you have?

Answer 15

Exception clauses (no coverage for X peril - does not suspend, simply narrows coverage)

Suspensive conditions (suspends coverage for certain conditions not being met)

Question 16

Terms not relevant to the actual loss?

Answer 16

Particular:
- Kind
- Location
- Time

If the insured can prove that the warranty did not directly apply to the loss based on the above, they may still be able to claim.

Question 17

For Motor insurance can an insurer reject a claim for breach of warranty/ condition?

Answer 17

No - not from a third party under road traffic act 1988

Question 18

For employers liability, when a condition is broken, what cases can an insurer not avoid the claim?

Answer 18

1- on grounds of late notification
2- policy condition requiring employer to take reasonable care against injury or disease

Question 19

Joint VS Composite insurance?

Answer 19

Joint: interest of insureds are the same and a breach by one effects all

Composite: breach by one does not effect all

Question 20

How would you distinguish between a breach of fair presentation and condition/ warranty?

Answer 20

Fair presentation is pre contractual

condition/ warranty is usually during the contract

Question 21

What is ejusdem generis

Answer 21

The words that follow are of the same kind

Question 22

effect of contra proferentum when interpretation an ambiguous term

Answer 22

where the term is ambiguous, the preferred is against the one who proposed it

Question 23

warranty in insurance VS non-insurance contracts

Answer 23

non insurance - minor term
insurance- promise to do something and suspends the contract

Question 24

what is a continuing warranty in insurance?

Answer 24

promise that will continue

Question 25

How can a warranty be created

Answer 25

Marine - express or implied
Others - express only

Question 26

Can an insurer reject a claim for breach of warranty but allow the policy to continue?

Answer 26

Yes

Question 27

What did IA 2015 introduce to remedy breach of a warranty

Answer 27

cover does not terminate for breach of warranty - it is just suspended and the insured can remedy it

Question 28

How does English law distinguish between joint and composite

Answer 28

hinges on the interests of the insureds

Question 29

importance for establishing joint v composite

Answer 29

Joint is indivisible