Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

CII > IF3.6 Commercial Insurances / IF4.2 > Flashcards

IF3.6 Commercial Insurances / IF4.2 Flashcards

1
Q

For a claim to be completed in commercial property insurance, perils must…

A

result in damage to the property

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What does fire and special perils insurance do?

A

compensates the insured in the event of property damage caused by a fire of any of the ‘special perils’

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What are the three parts of standard fire cover?

A

-fire (excluding explosion resulting from fire, earthquake or subterranean fire, and spontaneous fermenting or heating)
- lightning
- explosion (restricted to domestic purposes only)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What are the special perils in a fire and special perils policy?

A

Damage caused to the property by…
- Explosion (excluding boilers exploding due to steam)
- Aircraft (excl. sonic bangs)
- Riot and civil commotion (within 7 days)
- Malicious Damage e.g. vandalism
- earthquake
- Subterranean fire (underground fire)
- spontaneous fermentation or heating)
- Storm and Flood
- Escape of water (burst pipes)
- Impact (e.g. vehicles)
- Sprinkler leakage
- subsidence, ground heave or landslip.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Why do UK insurers accept earthquake as a special peril?

A

There is minimal earthquake activity in the UK

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What are the special perils in a fire and special perils policy which are SOCIAL

A
  • Riot and civil commotion (within 7 days)
  • Malicious Damage e.g. vandalism
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What are the special perils in a fire and special perils policy which are NATURE

A
  • earthquake
  • Subterranean fire (underground fire)
  • Storm and Flood
  • subsidence, ground heave or landslip.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What are the special perils in a fire and special perils policy which are CHEMICAL

A
  • Explosion (excluding boilers exploding due to steam)
  • spontaneous fermentation or heating
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Riot Compensation Act 2016 / Riot Compensation Regulations 2017

A
  • applies a £1 mil limit for any one claim
  • will not apply to any consequential loss
  • Claims against police have 42 days (a further 90 days to submit full claims details)
  • provides limited cover for motor vehicles and trailers
  • permits replacement goods and property on a new for old basis
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Standard exclusions of Commercial property insurance

A
  • war risks
  • radioactive contamination
  • terrorism
  • Northern Island Excluded perils
  • Pollution or contamination (unless caused by an insured peril)
  • Marine policies
  • ‘More specifically insured’ clauses
  • ‘consequential loss’ e.g. loss of profits
  • sonic bangs
  • cyber risks
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

what does ‘All risks’ commercial insurance cover

A

Does not cover everything, just covers everything that is not specifically excluded.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Four groups of exclusions

A
  • absolute exclusions
  • gradually operating exclusions
  • aspects of cover which can be written into the policy
  • property risks more appropriate to another class of business
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

absolute exclusions

A

War, pollution, contamination, consequential loss

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

gradually operating exclusions examples

A

corrosion/rust, wind/rain damage

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Aspects of cover which can be written into the policy examples

A

e.g. money, glass, subsidence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Property of risks more appropriate to another class of business examples

A

motor vehicles, aircraft

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

theft Insurance

A

Insurance to damage caused by theft and theft itself

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Theft Act 1968

A

Someone is guilty of theft if they dishonestly appropriate property belonging to another with the intention of permanently depriving the other of it

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Condition of commercial theft cover

A

must include force and violence either breaking in or out of the insured premises, removes cover for entry by a key, a trick or concealment on the premises while open and leaving without forcible exit.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

common extensions to commercial theft insurance

A
  • breakage of glass (unless specifically covered elsewhere)
  • replacement of locks if keys are lost
  • temporary removal
  • index-linking
  • extended or full theft
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

common exclusions of commercial theft insurance

A
  • collusion
  • fire and explosion
    -cash, bank notes etc
  • livestock
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Estimated maximum loss (EML)

A

the amount which is considered by the insurer to be an accurate reflection of the worst financial effect that the maximum foreseeable loss would have.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

commercial glass insurance

A

destruction or damage to all fixed glass, including windows, doors, fanlights, showcases, mirrored glass and glazed partitions, and usually includes an extension to provide for the cost of boarding up damaged glass until replacement can be effected.
Usually excess of £250 to avoid small claims.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

A usual exclusion in commercial glass insurance

A
  • scratching or chipping
  • damage by fire, lightening and explosion
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

commercial money insurance

A

Protects against the loss of money & damage to safes and strong rooms in attempted theft.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

negotiable items

A

readily convertible into their cash value e.g. cash (low limits £1000)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

non-negotiable items

A

difficult to convert into a cash value e.g. cross cheques (high limits £250k)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

limits of negotiable items

A
  • while in the premises, when open for business and while in transit (standard limit e.g. £1000)
  • Money in a safe (higher up to 10k)
  • premises out of working hours (lower £250)
  • private residence of a employee (low e.g. up to £250)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

standard extensions for commercial Money insurance

A
  • personal accident/assault
  • credit cards
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

specific exclusions for commercial Money insurance

A
  • errors in book keeping
  • dishonesty of an employee (not discovered in 7 days)
  • damage arising outside the UK
  • a safe/strong room being opened by a key left on the premises (while closed for business)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

escort warranty

A

depending on the amount of money being carried a specific number of people may need to be present

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

Index-linking

A

adjusts the declared value at renewal to make sure that inflation is taken into account so that the sum insured will be sufficient.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

what is theft cover usually priced on?

A

Estimated maximum loss (EML)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

Target goods

A

high value items which may be targeted by thieves e.g. computer equipment, wines & jewellery
HIGH VALUE LOW QUANTITY ITEMS

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Pecuniary Insurance

A

Loss involves a direct financial loss

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

Business Interruption Insurance

A

Covers loss of earnings and expenses incurred while a business is unable to operate at full capacity due to fire or other insured incident.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

Examples of pecuniary insurance

A

Business Interruption & Legal

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

Why is business interruption neccessary?

A
  • earning may reduce or cease following property damage
  • certain overheads still need to be paid
  • increases in costs incurred in order to keep the business operating
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

What is the sum insured of business interruption based on?

A

gross profit (turnover)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
40
Q

How is gross profit calculated?

A

turnover - uninsured working expenses

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
41
Q

Material Damage Proviso

A

Can’t make a claim from a business interruption policy until you have a property policy covering the physical damage for the incident and have made a claim.

42
Q

Maximum indemnity period for business insurance

A

chosen by the insured as the amount of time that business interruption policy will support a business. (12 to 36 months)

43
Q

What are the two things covered on a Business insurance policy?

A
  • actual or potential earnings (loss of earnings)
  • overhead fees or increased costs to working (e.g. laptops)
44
Q

Uninsured working expenses

A

costs which vary in direct proportion to the level of turnover e.g. electricity, raw materials

45
Q

Optional Extensions of business interruption

A
  • specified suppliers
  • unspecified suppliers
  • specified customers
  • transit
  • prevention of access
  • public utilities
  • notifiable disease/murder/suicide
  • contract site (cover is provided for all sites not just the main one)
46
Q

Specified/Unspecified Suppliers for business interruption policies

A

if the supplier suffers a serious loss and cannot supply the insured goods then it will be covered. Unspecified is the same but they provide less than 10% of the materials and the limit of indemnity is lower.

47
Q

Specified customers for business interruption policies

A

If the retailer you sell most of your products too is damaged and stops buying will provide cover.

48
Q

Public Utilities for business interruption policies

A

failure of gas, water & electricity that effect production.

49
Q

Notifiable disease, murder & suicide for business interruption policies

A

if the insured is prevented from conducting their business activities on their premises business may be lost and is hence covered.

50
Q

Difference between and Increased cost of working policy (ICOW) and an increased cost of working clause in an business interruption policy

A

Stand alone policies cover uneconomic loss

51
Q

Legal Expenses Insurance

A

Costs arising out of the need to take action in the courts or to defend an action bought against the insured.

51
Q

Standard legal expenses insurance covers

A
  • employment disputes
  • criminal prosecution defence cover
  • property disputes cover
  • motor cover
  • patents, registered designs, copyright and trademarks cover (defending claims against alleged breach of copyright)
  • taxation proceedings
52
Q

Employment and property disputes legal cover

A

covers the cost of defending disputes e.g. with neighbours over planning applications or over unfair dismissal

53
Q

Criminal Prosecution Defence Cover

A

covers the cost of defending an action against the insured, usually under health and safety legislation (fines are excluded, this is against public interest)

54
Q

What does Motor legal cover protect agaisnt

A

uninsured loss recovery, defending motor prosecution

55
Q

Negligence

A

Doing something which the reasonable or prudent person would not do, or omitting to do something which a reasonable person guided by those considerations which ordinarily regulate the conduct of human affairs, would do.

56
Q

Employers Liability Insurance

A

Injuries arising from employers negligence will be covered & costs and expenses of the claimant when the event occurs within the boundary gates of workplace or in the course of employment

57
Q

Employers liability (Compulsory Insurance) Act 1969

A

every employer in great Britain must be insured against liability for bodily injury or disease sustained by their employees arising out of and in the course of their employment

58
Q

minimum limit of indemnity for employers liability insurance

A

£5m (although most insurers provide £10m)

59
Q

How long must you keep your employers liability insurance certificate?

A

40 years

60
Q

in employers liability insurance, pure accidents which are not the result of negligence are…

A

not covered.

61
Q

Enterprise and Regulatory Reform Act 2013

A

negligence must be proven when a claimant brings forwards an employers liability claim

62
Q

Define Employee

A

Any person who is under a contract of service or apprenticeship with the insured

63
Q

losses occuring

A

if disease was caused by work and has arisen since the policy expired then the policy is still liable.

64
Q

optional extensions of employers liability insurance

A
  • defence costs and expenses
  • additional persons insured (e.g. other partners, directors etc.)
  • compensation for court attendance
  • unsatisfied court judgements
65
Q

Public Liability Insurance

A

legal liability for third parties for damages in respect of bodily injury, death, disease or illness, and for any loss of or damage to property which happens in connection with the business insured under the policy and occurring during the period of insurance.
HAS TO BE NEGLIGENCE.

66
Q

Limit per occurence

A

When there is a limit of indemnity for an event that occurs (even if there are multiple claims resulting from the event).

67
Q

What does loss or damage to property exclude

A

intangibles e.g. copyrights and also direct economic loss

68
Q

Common exclusions of public liability insurance

A
  • those covered by other policies (e.g. injury to employees, property belonging to the insured, product liability, professional negligence, motor vehicles)
  • Contractual Liability
  • Cost of rectifying defective work
  • Deliberate acts
  • Vessels and craft
  • war risks
    -radioactive contamination
69
Q

Product Liability Insurance

A

legal liability for bodily injury or property damage which arises out of goods or products manufactured, constructed, altered, repaired, serviced, treated, sold, supplied or distributed by the insured.
sold in conjunction with public liability.

cover is for the consequential loss following an injury, not covering financial loss the loss must occur during the period of insurance. Must be an ACCIDENT.

70
Q

Yearly aggregate limit of indemnity

A

all total claims should not exceed a given limit

71
Q

Common exclusions for product liability insurance

A
  • contractual liability
  • damage to actual goods supplied
  • faulty design or formula
72
Q

Pollution Liability insurance

A

indemnity provided in respect of pollution or contamination caused by a sudden identifiable, unintended and unexpected incident which takes place at a specific moment and place.

73
Q

Professional Indemnity Insurance

A

liability for injury, damage or financial loss to clients or the public as a result of a breach of professional duty or negligent acts, errors or ommisions in their professional capacity.

74
Q

Claims made basis

A

The policy that is in force at the time of a claim is the one to pay out (not the one in place when the loss occured)

75
Q

Which policies are issued on a claims made basis?

A

professional indemnity

76
Q

Which policies are issued on a losses occuring basis?

A

product liability, public liability, employers liability

77
Q

Retroactive dates

A

when buying professional indemnity insurance a retrospective date should be provided which is the date where insurers will pick up claims from.

78
Q

Directors and officers (D&O) insurance

A

protects directors against personal liability for financial loss suffered by a third party.

79
Q

Companies Act 2006 on Directors

A

If a director breaches a responsibility they can be held personally liable.

80
Q

Errors and Omissions (E&O) Insurance

A

Intermediaries are required to hold E&O insurance to cover when a broker has made a mistake that their client to suffer a loss.

81
Q

Medical Malpractice Insurance

A

protection against damages and defence cots for any claims for bodily/personal injury or damage.

82
Q

Cyber Insurance

A

covers the losses relating to damage to, or loss of information from IT systems and networks.
Relates to both physical property, the pecuniary loss following interruption, and liability to third parties in respect of loss of or damage to third party property or loss of third party data.

83
Q

Specific points of cover of cyber insurance

A
  • loss of data
  • theft of money through electronic systems
  • loss of business following interruption to electronic systems
  • reputational risk following loss of data
  • cost of paying damages to third parties
  • legal defence cost
84
Q

first party cyber threats

A

those which directly effect the insured

85
Q

third party cyber threats

A

those which effect the third parties who the data related to

86
Q

Principle consideration when underwriting employers liability insurance?

A

the trade of the company

87
Q

Lapse Flow Analysis relates to

A

business which has been lost

88
Q

difference between consumer theft insurance and commercial

A

commercial always requires forcible or violent entry

89
Q

Is there cover for entry by a key, a trick concealment on the premises while open in commercial theft insurance?

A

No

90
Q

Additional Cost of Working (ACOW) in business interruption

A

business interruption will cover any increased costs of working after an event (a limit applies)

91
Q

With all risks cover, all loss or destruction of or damage to the property insured is recoverable as long as:

A
  • it has occurred accidentally in respect of the insured
  • the cause is no specifically excluded
92
Q

Standard legal expenses policy limit

A

25k-100k

93
Q

What 3 items are looked at under a Business Interruption policy?

A
  • gross profit
  • wages
  • accountants fees
94
Q

Main type of insurance policies partnered with Business Interruption policies

A
  • fire and special perils
  • all risks
  • engineering
95
Q

Creditor Insurance

A

Covers an insureds inability to continue credit instalments in the event of redundancy or unemployment.

Time limited.

96
Q

Territorial limits of employers liability insurance

A

The UK, Isle of Man, Channel islands or while temporarily outside of these territories.

97
Q

Max time benefit payments for personal accident will be paid

A

104

98
Q

Franchise

A

period of time/ amount of money which must be exceeded before policy comes into force.

99
Q

Usual franchise time period for sickness policies

A

7 days

CII (28 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions