Chapter 7 Flashcards
Is a policy contract of insurance in itself
No it is evidence of the contract
What 5 things do policy contain starting with the details of cover
- The period of cover
- The premium
- Policy exceptions and conditions
- Any special terms which apply
What is the standard policy wording contained in
A) the policy wording
B) in a pre printed booklet, and a schedule is incorporated at the end of the policy
B) in a pre printed booklet, and a schedule is incorporated at the end of the policy
When does the contract of insurance comes into effect
A) one the insurer has accepted the insurance proposal, terms have been agreed and the policyholder has agreed to pay the premium
B) once the premium has been paid
A) one the insurer has accepted the insurance proposal, terms have been agreed and the policyholder has agreed to pay the premium
Who has issued a code of good practice which includes device standards for issuing insurance documents within good time
A) FCA
B) ABI
B) ABI
What do the ABI define promptly as
A) within 30 working days
B) within 30 calendar days
B) within 30 calendar days
What does narrative type mean:
A) when there was a policyholder who was the narrative
B) each individual policy was prepared by hand and was specific to the insured concerned
B) each individual policy was prepared by hand and was specific to the insured concerned
Under FCA rules for commercial customers when must policy document be issued
A) 21 days
B) promptly
B) promptly
What are most policies issued in
A) scheduled forms
B) narrative type
A) scheduled form
What does the policy schedule contain
A) warranties and exclusions
B) variable info and usually signifies which sections of the policy are operative
B) variable info and usually signifies which sections of the policy are operative
What is the below:
Includes the name and address of the insurer, the type of policy and in some cases the company logo
Heading,
Recital clause,
Signature
Operative clauses
Heading
Is the below a condition or a warranty
Subrogation
Gives the insurer the right of subrogation before payment of any claim is made
Condition
What is the below:
Coming together to form the contract in which the insured has paid or agreed to pay the premium and the insurer undertakes to indemnify the insured in accordance with the cover detailed in the policy
Heading,
Recital clause,
Signature
Operative clauses
Recital clause
What is the below:
Under the recital clause is pre printed on the document
Heading,
Recital clause,
Signature
Operative clauses
Signature
What is the below:
Insurers are increasingly committed to simplifying policy wording and many have restyled their language
Heading,
Recital clause,
Signature
Operative clauses
Operative clauses
What is the below:
In addition to those exclusions specifically stated in the operative clauses which apply to specific sections of cover they also contain exclusions which apply to the entire contract
A) exceptions
B) conditions
C) policy schedule
D) info and facilities
A) exceptions
What is the below:
First are implied and the second express
A) exceptions
B) conditions
C) policy schedule
D) info and facilities
B) conditions
Is the below an implied or express conditions
Insured must act as it uninsured
Insured may be required to advise the appropriate authorities
Insured must take reasonable action
Insured must not hinder the insurers in the investigation of a claim
Implied
Of which of these are included on booklet policies m
Insured define a single word or phrase to embrace the wider wording
A) definitions
B) customer service standards statement
C) complaints procedures
A) definitions
Of which of these are included on booklet policies
The details what the insured may expect in respect of the Service provided. And will include details of any helplines and contact telephone numbers
A) definitions
B) customer service standards statement
C) complaints procedures
B) customer service standards statement
Of which of these are included on booklet policies
This will detail the procedures to be followed and the circumstances to be referred to the Financial Ombudsman.
A) definitions
B) customer service standards statement
C) complaints procedures
C) complaints procedures
What makes the policy personal and specific to the insured
A) schedule
B) preamble
A) schedule
What is the below:
Or preamble sets the scene for what follows In the policy. It refers to the two parties coming together to form the contract
Heading,
Recital clause,
Signature
Operative clauses
Recital clause
What 10 things are included on a schedule starting with
Insureds name
Insured address
Policy period
Premium
Details of the subject matter
Sums insured
Territorial limits
Policy number
Reference to special exclusions
Operative sections of the policy
What do most general insurance policies contain which apply to sections of the policy
A) specific exclusions
B) general exclusions
A) specific exclusions
Is the below a condition or a warranty
Contribution
The insured is obliged to claim proportionately from each insurer
Condition
Policies contain exclusions which apply to the entire contract known as
A) specific exclusions
B) general exclusions
B) general exclusions
What is known when an exclusion is known to all general insurance policies
A) general exclusions
B) market exclusions
B) market exclusions
Is the below an exclusion
Radioactive contamination and explosive nuclear assemblies
Yes but cover can be provided by a system or market pools which insurers and reinsured accept a share of the risk
Is the below an exclusion
Electronic risk
Yes but newly excluded
Loss of data and loss, destruction of damage unauthorised access to or use of computer equipment are excluded under what
A) sonic bangs
B) electronic risk
B) electronic risk
Is the below a condition or a warranty
Action by the insured in the event of a claim
Sets out procedures including timescales
Conditions
Is the below an exclusion
Pollution and or contamination
Yes but can be included on property damage but not liability
Is the below an exclusion
Sonic bangs
Yes
What must or just not be done for cover to be valid
A) warranties
B) conditions
B) conditions
Is the below a condition or a warranty
Duties of the policyholder
The insurer must observe and fulfil all the terms of the policy for cover to be valid
Conditions
Is the below an implied or express conditions
Those stated in the policy. In practice they include many of the otherwise implied conditions which are stated in order to clarify matters for the insured
Express conditions
Is the below a condition or a warranty
Fair presentation of the risk
Highlights insureds responsibility under the IA 2915 to make a fair presentation of the risk
Condition
Is the below an exclusion
War and related perils
Yes as it’s regarded to be the responsibility of the state
Is the below a condition or a warranty
Fraud
This is concerned only with claims. Entitled the insurer to avoid the policy as a whole
Condition
If the type of loss is irrelevant to the claim due to something other than a breach of warranty can insurers decline the claim
No
Under the fraud condition if the insurer finds that a claim is fraudulent what happens
A) they can reject the claim and any payments made in relation to the fraudulent claim are recoverable from the insured
B) they can’t reject the claim and any payments made in relation to the fraudulent claim are recoverable from the insured
A) they can reject the claim and any payments made in relation to the fraudulent claim are recoverable from the insured
Under the fraud condition if the insurer finds that a claim is fraudulent what happens
A) the insurer has the option to terminate the contract but only from the date at which it became fraudulent. The option of avoidance has been removed.
B) if the insurer chose to terminate the contract they can refuse liability for all matters occurring after the date and don’t have to return any premiums paid
Both
Under the fraud condition if the insurer finds that a claim is fraudulent what happens to legitimate losses prior to the fraudulent act
A
They are protected
Is the below a condition or a warranty
Reasonable precautions
Formalised the implied condition
Condition
Is the below an implied or express conditions
Exist whether or not they appear in the policy
Implied
What is the below:
Describe the scope of the cover in detail. It is the heart of the policy.
Often contain exceptions that are specific to each individual clause
Heading,
Recital clause,
Signature
Operative clauses
Operative clauses
Is the below a condition or a warranty
Average
Condition
Is the below a condition or a warranty
A promise made by the insured relating to facts or performance concerning the risk
Warranty
What is a certificate of insurance
A) evidence that a context of insurance exists
B) proof of documentation
A) evidence that a context of insurance exists
Is the below a condition or a warranty
Arbitration
Condition
Is the below a condition or a warranty
Cancellation
Condition
Is the below a condition or a warranty
Continuing conditions precedent
Conditions
Is the below a condition or a warranty
Alteration
Insured must notify the insurer of any changes that increase the risk
Condition
Is the below a condition or a warranty
Something will or will not be done and
A certain fact exists or does not exist
Warranty
What is a continuing warranty
warranty that may relate to past or present facts in which the insured promises that a state of affairs will continue or exist or the insured will continue to do something.
What constitutes a breach of warranty
A) non payment of premium
B) non compliance
B) non compliance
What does it mean by warranties being suspensive conditions
A)payments aren’t made for claims until conditions are met
B) a breach of warranty merely suspends the insured liability under the policy. Insurer won’t be liable for losses occurring while the insured is in the breach of warranty
B) a breach of warranty merely suspends the insured liability under the policy. Insurer won’t be liable for losses occurring while the insured is in the breach of warranty
What is the below
These are conditions that must be fulfilled prior to the formation of the context itself. Implied conditions such as insurable and interest are these
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions prevent to liability
A) conditions precedent to the contract
Which three matters will render a policy void immediately starting with an illegal contract
2 no insurable interest
3 a fundamental mistake
What is the below
A deliberate misstatement the insurer can choose to avoid the policy
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions prevent to liability
A) conditions precedent to the contract
What is the below
Conditions that are ongoing and require complaisance through the policy period
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions prevent to liability
B) continuing conditions precedent
Is the below a condition or a warranty
Must be strictly and literally complied with for cover to be valid
Warranty
Which is the below
Would include the alteration condition and the conditions which insurers incorporate into the policy wordings
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions prevent to liability
Continuing conditions precedent
What 5 things must be on an EL cert starting with name of policyholder
2- date of commencement of cover
3- expiry date
4- a statement that cover complied with UK statutory requirements
5- statement that the minimum amount of cover provided by the policy is no less than £5m
What is the below:
A breach of such a condition entitled the insurer to avoid the whole contract from the date of the breach
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions prevent to liability
Continuing conditions precedent
What is the below:
Conditions that just be complied with it there is to be a valid claim. They include conditions which are often listed as the claims conditions
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions precedent to liability
Conditions precedent to liability
Under FCA rules unless fraud is involved insurer should not repudiate liability to indemnify on the grounds of a breach of a condition
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions precedent to liability
C) conditions precedent to liability
What is the below:
Must be strictly and literally complied with
Suspend cover if breached and relevant to a loss incurred
are written into the policy
A) warranties
B) conditions
C) exclusions
D) representations
Warranits
What is the below:
If this is not observed, insurers may avoid liability for a particular loss but they may not repudiate the contract as a whole
A) conditions precedent to the contract
B) continuing conditions precedent
C) conditions precedent to liability
C) conditions precedent tocliability
What is the below
Some implied conditions are so fundamental they affect the whole validity of the policy and render it void if breached
Other conditions prevents to the contract such as mid statement entirely the insurer to avoid the policy st its option
A) warranties
B) conditions
C) exclusions
D) representations
B) conditions
what is the below
A breach of a continuing precedent entities the insurer to avoid the whole contract from the date of the breach
Breach of a condition precedent to liability entitled the insurer to avoid the particular claim
A) warranties
B) conditions
C) exclusions
D) representations
B) conditions
What is the below
Used to defund the boundaries of policy cover
Allow repudiation if claims circumstance indicate that the exclusion applies
Require the insurer to prove that the exclusion applies
Will always appear in the policy
A) warranties
B) conditions
C) exclusions
D) representations
Exclusions
What is the below
Not part of the policy
Must relate to a martial circumstance
If incorrect allow the insurer to repudiate ab initito
Doesn’t appear in the policy itself
A) warranties
B) conditions
C) exclusions
D) representations
D) representations
