Chapter 8 Flashcards
What is the primary role of an Article 75 Insurer?
A) To act as an intermediary between insurers and claimants
B) To compensate victims when no valid insurance policy applies
C) To determine liability in all motor claims
D) To regulate the motor insurance industry
B
Under the Uninsured Drivers’ Agreement, when will the MIB NOT provide compensation?
A) If the accident involves a hit-and-run driver
B) If the claimant was a passenger who knew the driver was uninsured
C) If the driver failed to report the accident within 24 hours
D) If the claim is for vehicle damage only
B
What is the purpose of the Dual Indemnity Undertaking?
A) To allow insurers to avoid liability if multiple policies exist
B) To prevent contribution claims between insurers when two policies cover the same incident
C) To ensure that all policies covering a driver will contribute to a claim
D) To allow insurers to deny liability for uninsured drivers
B
The MIB Untraced Drivers’ Agreement applies when:
A) The policyholder’s claim is rejected by their insurer
B) The accident was caused by a driver who fled the scene and cannot be identified
C) A vehicle was stolen and then recovered
D) The insurer of the at-fault driver has become insolvent
B
Which of the following is TRUE about the Personal Effects Insurance Contribution Agreement?
A) It requires home insurers to settle all personal effects claims before motor insurers
B) It prevents multiple insurers from paying out on a single personal property claim
C) It allows policyholders to claim for personal belongings under either home or motor insurance without contribution disputes from other insurers that also insure
D) It only applies to business-related property
C
Under what circumstance are the police required to attend a road traffic accident?
A) When any vehicle involved is over five years old
B) When injuries occur or a crime has been committed
C) When one party refuses to exchange details
D) When the damage exceeds £2,000
B
Which of the following statements about police crime reference numbers is TRUE?
A) They guarantee the validity of a claim
B) They are required for all motor insurance claims
C) They indicate that a theft or crime has been reported, but do not confirm validity
D) They mean the police have completed an investigation
C
Why might an insurer request a police report for a theft claim?
A) To verify whether the claimant has a criminal record
B) To confirm whether the vehicle was recovered
C) To validate the circumstances of the reported theft
D) To determine if the vehicle owner had previous claims
C
What is the primary role of a motor engineer in claims handling?
A) To negotiate settlements with third-party insurers
B) To conduct forensic investigations into fraudulent claims
C) To assess vehicle damage and repair costs
D) To ensure all repairs comply with government regulations
C
Why do insurers often recommend or approve repairers?
A) To reduce repair costs and control quality
B) To increase competition among garages
C) To provide policyholders with more expensive repair options
D) To allow the policyholder to claim additional benefits
A
How do Advanced Driver Assistance Systems (ADAS) affect motor claims?
A) They increase repair costs due to expensive sensor replacements
B) They eliminate the need for human drivers
C) They reduce liability disputes in claims
D) They make all vehicles fully autonomous
A
What is the main issue with alternatively sourced parts in vehicle repairs?
A) They are always more expensive than original manufacturer parts
B) They may lead to disputes over vehicle warranties
C) They are banned under UK insurance law
D) They always void a vehicle’s insurance policy
B
What is the Financial Ombudsman Service (FOS) responsible for in motor claims?
A) Investigating and prosecuting fraud cases
B) Resolving disputes between policyholders and insurers
C) Enforcing road traffic laws
D) Negotiating policy premiums on behalf of customers
B
Alternative Dispute Resolution (ADR) is preferred over litigation because:
A) It allows insurers to avoid regulatory oversight
B) It is faster and less expensive than court proceedings
C) It always results in a higher settlement for claimants
D) It forces insurers to accept liability
B
What is the main function of arbitration in motor claims disputes?
A) To allow insurers to reject claims without explanation
B) To provide an independent expert decision on the dispute
C) To replace legal proceedings entirely
D) To determine whether a policyholder should renew their policy
B
What is a Calderbank offer in the context of motor claims?
A) A final settlement offer made by the court
B) A confidential offer made to encourage settlement without going to trial
C) A claim rejection notice sent by an insurer
D) A police investigation document for serious accidents
B
Which of the following is NOT a type of Alternative Dispute Resolution (ADR)?
A) Mediation
B) Litigation
C) Arbitration
D) Negotiation
B
A driver’s policy covers them for third-party damage, but the accident occurred while they were driving a friend’s car under a “Driving Other Cars” extension. Who is primarily responsible for indemnifying the third-party claim?
A) The driver’s policy
B) The vehicle owner’s policy
C) The MIB
D) The third party’s insurer
B
An insured driver was involved in an accident, but they delayed reporting it to their insurer for three months. What is the likely consequence?
A) The claim will be automatically denied
B) The insurer may investigate for prejudice due to late reporting
C) The policyholder will face criminal charges
D) The insurer must still pay in full without investigation
B
A claimant disputes the market valuation of their written-off vehicle. What should they do first?
A) Take legal action immediately
B) Request an independent valuation
C) Refuse to accept the insurer’s settlement
D) Contact the Financial Ombudsman Service directly
B
