Compulsory Insurances Flashcards
How does the UK government act as insurer in its own right?
Provides certain benefits to individuals including welfare benefits, unemployment benefits and retirement benefits
How does the UK government ensure certain risks are insured?
Legislation - aim is to ensure funds are avaliable to compensate innocent victims
What insurances are compulsory by law? (consider private individuals and professions/businesses)
For private individuals - motor insurance and public liability (if individual keeps dangerous dog/animal)
Professions and businesses - motor insurance for companies using motor vehicles on a road, employers liability, public liability for certain professions (i.e. riding establishments), professional indemnity for certain professions (i.e. solictors and intermediaries) and marine pollution liability
Why is insurance compulsory for particular individuals/professions?
- Provides funds for compensation
- In response to national concerns (i.e. areas where insurance has been made compulsory represent areas of national concern)
What is employers liability insurance?
The Employers Liability Act made it compulsory for all employers in the UK to have this insurance.
Insures employers against their liability to pay compensation to employees who injure themselves or sustain a disease arising out of employment.
Mimimum required limit of indemnity is 5 million!
Employers liability regulations act changed the need for employers to retain their certifiates on insurance (prior to this act they had to do this)
What act ensures motor insurance is compulsory?
Road Traffic Act states that it is illegal to use a vehicle on a public road/space without insurance.
Act states the insurance must cover third-party damage and third-party injury or death as a minimum.
EU has been influential in shaping legislation, many EU directives have been incorporated into UK law such as the fact you should be able to trace the insurer from a vehicle via its reg
Public liability insurance - riding establishments
Riding Establishments Act states that owners of riding establishments must have public liability insurance.
PL insurance must indemnify the insured against claims arising from the use of their horses (this would include injuries to people riding the horses and the general public)
PL insurance must also indemnify the horse riders themselves against any liability they may occurfor injury to the public arising out of the hire use of any owners horses.
Basically, if the horse rider tried to claim against the owner PL insurance must cover this, equally if a member of the public tried to claim against the horse rider the PL insurance must also cover this.
Apart from motor insurance, what other insurance is compulsory for private individuals?
Public liability - ownership of dangerous wild animals or dangerous dogs
The dangerous wild animal and dangerous dogs act sets out the nature/scope of insurance required - true or false?
False, it in the local authority (who issue the licence to own the animal) who must be satisfied with the insurance.
How do insurers generally insure the risk of a dangerous animal/dog?
They’ll generally insure liability arising out of the ownership of a dangerous animal/dog as an extention to another policy held by the insured (like a HH policy)
What is professional indemnity insurance?
Insurance compulsory in certain professions (solicitors, accounts, intermediaries) designed to protect them against claims about their services.
Solicitors Act states solicitors must hold PI insurance to indemnify them against claims of finanical loss suffered by clients as a result of negligence.
Which type of intermediaries need professional indemnity insurance?
Intermediaries directly authorised by the FCA must have PI insurance in respect of financial loss suffered by a TP caused by their professional negligence.
Appointed Reps and Introducer Appointed Reps do not need PI insurance.
How much indemnity cover must UK insurers have for employers liability
5 million
What is the minimum amount of indemnity the FCA requires an intermediary to have for professional indemnity?
1.25 million
