Insurance contracts and key terms lists Chapter 7

Question 1

Four types of condition and the impact of breached

Answer 1

1. Condition precdent to contract - contract void
2. Condition precedent to liability - insurer can refuse to pay claims
3. Collateral or mere condition - insurer must pay claim but can seek damages
4. Suspensive condition - no cover whilst breached

Question 2

Three prohibitions under Employers’ Liability (Compulsory Insurance) Regulations 1998 where insurers may not be able to reject a claim

Answer 2

1. on the grounds of late notification, or
2. because the insured has failed to comply with a policy condition which requires him to take reasonable care to protect his employees against injury or disease.
3. The use of policy excesses (deductibles)

Question 3

4 common rules of interpretation of insurance contracts

Answer 3

1. Ordinary meaning
2. Technical or legal meaning
3. Context (noscitiur a sociis and ejusdem generis)
4. Ambiguity - contra proferentem rule

Question 4

Three rules that deal with inconsistencies in contract documentation

Answer 4

1. Where printed words conflict with words that are hand-written or typed, the latter take precedence
2. Policy takes precedence over proposal
3. Express term overrules an implied terms