Liabilty Insurance

Question 1

Employers liability insurance is compulsory in the UK under the employers liability compulsory insurance act 1969 it covers…

Answer 1

The liability of employers for injury to or sickness of an employee arising out of and in the course of employment.

Question 2

Why is there no standard employers liability policy?

Answer 2

Because it is common to issue combined liability policies which include employers, public and product liabilities. But there are separate sections and clauses that apply to each type of liability

Question 3

What is E R.N. most commonly referred to?

Answer 3

Employer reference number.
It is unique to an individual employer. In addition employers must give this to their employers liability insurers

Employer PAYE reference

Question 4

What sort of costs and expenses might be incurred by a claimant settling out of court in respect of bodily injury incurred as a result of an accident involving machinery?

Answer 4

In this scenario case costs will be incurred for the use of expert witnesses to examine the machinery at the scene of the accident. There will still also be legal fees to pay even though the case has been settled out of court

Question 5

What is vicarious liability?

Answer 5

Inlaw an employer is liable for the negligence of employees of rising in the course of their employment.

Question 6

As a regulatory requirement which professions will need professional indemnity insurance?

Answer 6

Insurance brokers and financial advisors.

Question 7

Under statute what professions will need professional indemnity insurance?

Answer 7

Solicitors.

Question 8

What is the purpose of professional indemnity insurance?

Answer 8

Protects a professional person against claims which might be made allegedly that injury or loss resulted from their actions or advice

Question 9

A butcher wishes to arrange protection against claims made by customers who become ill as a result of eating their meat pies which insurance policy will meet their needs?

Answer 9

A product liability policy

Question 10

What kind of policy is a public liability policy?

Answer 10

It is an open policy, instead of the scope of cover being specified by insured perils it is defined by the exclusion of specific perils

Question 11

What is the purpose of public liability insurance?

Answer 11

Designed to compensate and insured in respect of claims for legal liability for members of the public or companies who may suffer due to their negligence or that of their employees.

Question 12

What is one of the fastest growing forms of crime in the world?

Answer 12

Cybercrime

Question 13

Why do you think extended warranty insurance is needed if the insured already holds household contents insurance?

Answer 13

Household policies exclude wear and tear and mechanical and electrical breakdown.

Question 14

What does public liability insurance cover?

Answer 14

The insured legal liability to 3rd parties for damages in respect of bodily injury, death, disease or illness and the loss of or damage to property, arising from the business insured.

Question 15

What are the possible elements for product liability insurance basically what is the need for the claim?

Answer 15

There is usually an element of accident, and injury or loss not the sale, must occur during a period of insurance.

Question 16

What is directors and officers insurance?

Answer 16

It provides cover for directors and officers in their personal capacity when they are unable to claim an indemnity from their company, and for their company when it can indemnify them. Cover is on a claims made basis for example it covers all claims made during the period of insurance no matter when the loss occurred

Question 17

What are the possible elements of product liability insurance?

Answer 17

There is usually an element of accident, and the injury or loss, not the cell, must occur during a period of insurance. For example if a customer buys a faulty product and has injured themselves because of it then the company will be indemnified to pay losses as long as it has happened during the period of insurance

Question 18

What is directors and officers insurance?

Answer 18

This provides cover for directors and officers in their personal capacity when they are unable to claim an indemnity from their company, and for their company when it can indemnify them. Cover is on a claims made basis.

Question 19

What is a claims made basis?

Answer 19

It covers all claims made during the period of insurance, no matter when the loss occurred

Question 20

What is professional indemnity insurance?

Answer 20

Protects a professional person against claims alleging that injury or loss has resulted from their actions or advice. It covers liability for injury, damage and financial loss. Cover is on a claims made basis.

Question 21

What is trustee insurance?

Answer 21

Insurance for pension fund trustees cover call awards against trustees, losses to the pension fund and employer plus defence costs. Cover is on a claims made basis. Assurance charity trustees insurance covers and management risks incurred by charities and their trustees and provide a personal indemnity to the trustees.

Question 22

What is an annual aggregate?

Answer 22

It is a policy limit for D and I insurance that means there is only one single limit for all the claims against all the insured during the policy year

Question 23

What is a claims occurring basis?

Answer 23

So long as the event giving rise to a claim happens during a period of insurance policy will respond even when the claim is notified after the policy has expired.

Question 24

What type of insurances are on a claims occurring basis?

Answer 24

Employers liability, public liability and product liability

Question 25

Which type of trustees will need trustee insurance?

Answer 25

Pension fund trustees

Charity trustees

Question 26

What is the key exclusion for professional indemnity insurance

Answer 26

Dishonesty of the insured

Question 27

What is the main exclusion of Trustee insurance

Answer 27

Wrongful acts meaning breach or alleged breach of duty or trust neglect error omission and increase labour or slander. Principal exclusions relate to bodily injury property damage pollution, food or wilful acts and failure on the part of the employer to fund or collect contributions.

Question 28

What does insurance for pension fund trustees cover

Answer 28

Call award against us days, losses to the pension fund and employer plus defence costs cover is on a claims made basis

Question 29

What does charity trustees insurance cover

Answer 29

The management ricks incurred by charities and the trustees and provides a personal indemnity to the trustees

Question 30

What does cyber insurance generally cover?

Answer 30

It will generally address external attacks on insured IT systems, as well as internal failures resulting in data breaches, cover the cost of civil actions arising from these attacks or breaches and the cost of restore in the affected systems.

Question 31

What is extended warranty insurance

Answer 31

It is a personal insurance offered to purchasers of consumer durables it provides a time extension to the manufacturers guarantee of up to 5 years

Question 32

What is the legislation by which employers liability insurance is made compulsory and the minimum limit of indemnity permitted?

Answer 32

The employers liability compulsory insurance act 1969 and the employees compulsory insurance regulations 1998 the minimum limit is £5 million

Question 33

What colour is given under an employers liability policy?

Answer 33

Legal liability for damages plus costs and expenses incurred if any employee sustained body injury, disease, illness or death arising out of an in the course of employment by the insured.

Question 34

How many cover under an employers liability policy be limited?

Answer 34

Employers liability policy may be limited by restricting the definition of business, excluding certain kinds of work or excluding certain machines and or or processes.

Question 35

What monetary limit do most insurers impose on employers liability policies?

Answer 35

The minimum limit is £5 million but we have seen insurers offering maximum £10 million

Question 36

In respect of public liability insurance, what are the definitions of injury and damage?

Answer 36

Injury means body injury to or illness, disease or death of any person.

Damage means loss of or physical damage to material property.

Question 37

What are the two most common optional extensions to a public liability policy?

Answer 37

Tenants liability and defective premises are the two most common extensions

Question 38

What is the basic purpose of product liability insurance?

Answer 38

To cover legal liability for bodily injury or property damage caused by products or goods.

Question 39

What is the purpose of directors and officers insurance?

Answer 39

Directors and officers insurance is designed to cover the legal liability of individuals within a company who may be personally liable for breaches of duty and so incur financial liabilities.

Question 40

What is the purpose of professional indemnity insurance?

Answer 40

Covers the legal liability of members of the professions for injury, damage or financial loss to clients/the public as a result of breach of professional duty or negligent acts, errors or omission.

Question 41

What cover is provided by an extended warranty policy?

Answer 41

An extended warranty policy will cover free repairs following electrical and mechanical defects for a period of up to 5 years.

Question 42

Typical Sam insured under an extended warranty policy is?

Answer 42

£2500 per period of insurance.

Question 43

What did the financial conduct authority made compulsory for employers liability tracing office members?

Answer 43

To provide details of all their employers liability policies along with policy records relating to historic covers triggered by claims to allowed a tracking of policies by claimants via the employers liability database ELD

Question 44

One of the recommendations of the independent inquiry into child sexual abuse was…

Answer 44

To establish a public liability policy tracing service for public institutions.

Question 45

For a valid claim to be made under an employers liability policy the bodily injury or death must have been caused…

Answer 45

During the period of insurance

Question 46

Which change was introduced by the companies act? ( D+O insurance)

Answer 46

Codified certain responsibility of directors.

Question 47

Which type of cover is always written on a claims made basis?

Answer 47

Pension fund trustee insurance, professional indemnity, directors and officials

Question 48

Under an employers liability insurance and employee is defined as…

Answer 48

Any person under contract of service or apprenticeship with the insured.

Question 49

The standard extensions to an employers liability include…

Answer 49

Indemnity to principle.

Defence costs and expenses to the insured.

Question 50

In an employers liability policy why is it important that the trade of business is fully defined in the policy?

Answer 50

This is to avoid any problems with claims that arise from work carried out that goes beyond the business stated in the schedule

Question 51

The cover under an employers liability policy includes claims arising out of the trade or business of the insured as defined in a policy wording plus it can be extended to include ancillary services this includes…

Answer 51

Private fire brigades, first-aid facilities, canteens and private ambulance services and private work carried out for any director, partner employee of the company

Question 52

A public liability policy is an open policy this means…

Answer 52

All legal liabilities are covered in less specifically excluded

Question 53

The limits of indemnity under an employers liability policy is…

Answer 53

A standard limit in line with the general market practice £10 million

Question 54

What is the main rating factor for professional indemnity insurance?

Answer 54

The insured is profession

Question 55

What limit of indemnity is normally provided under an employers’ liability insurance policy?

Answer 55

£10m but min by law is £5m

Question 56

Under which insurance policy does an employer normally insure his liability in respect of injury to his employees being driven as passengers in the employer’s cars?

Answer 56

Motor policy

Question 57

One of the common exclusions under an extended warranty insurance policy relates to any risks normally covered by which other type of insurance policy?

Answer 57

A household contents insurance policy.

Question 58

Under a typical extended warranty insurance policy, what proportion of the cost of labour and parts is normally covered?

Answer 58

100% of the cost of both labour and parts.

Question 59

In what circumstances will a public liability insurance policy pay a claim for pollution of air, water or soil?

Answer 59

When pollution is caused by immediate discharge consequent upon an accident.

Question 60

What type of insurance policy would provide cover for an accountant’s liability to compensate her clients for losses due to errors or omissions by her staff?

Answer 60

Professional indemnity