Making The Claim

Question 1

How can someone other than the PH make a claim? (9)

Answer 1

By assignment 
By agency 
Trusts
RTA 1988
Third Parties (Rights against Insurers) Act 2010 
Law of Property Act 1925
Fires Prevention (Metropolis) Act 1774 
Policies with additional insureds
Noting the interest of 3rd parties

Question 2

How does making a claim on a policy under Assignment work?

Answer 2

The contract or the benefit of the contract can be assigned to a 3rd party

If its legal that person can enforce the contract in their own name

If its an equitable assignment the assignee must join the assignor in the action

Question 3

How does making a claim on a policy under Agency work?

Answer 3

A 3rd party can claim if they have authorised an agent (PH) to insure on their behalf

Question 4

How does making a claim on a policy under a Trust work?

Answer 4

Most common example is the Married Womens Property Act 1882

Benefits are the money is not considered part of the estate and does not need to be used to clear debts

Question 5

What is privity of contract?

Answer 5

It confines the rights and duties under a contract to the person who originally made it

Question 6

How does someone other than the PH make a claim on a policy under The RTA 1988?

Answer 6

Named drivers or someone with the PHs permission can make a claim
Victims can also make a direct claim on the policy

Question 7

How does someone other than the PH make a claim on a policy under The Third Parties (Rights against Insurers) Act 2010?

Answer 7

If a PH has a liability policy, becomes insolvent but also has a liability claim then their rights under the contract transfer to the 3rd party claimant.

Question 8

What happens if you sell your building while making a claim make a claim under The Law of Property Act 1925?

Answer 8

If you own a building, sell it and then make a claim you have to hand the money over

Question 9

How does someone other than the PH make a claim on a policy under The Fire Prevention (Metropolis) Act 1774?

Answer 9

If a building burns down then a person who has legal or equitable interest in it can insist the insurer reinstates the building

Question 10

Other than notice of loss what else must the PH inform the insurer about in relation to claims?

Answer 10

Must give notice of any event or incident which may give rise to a claim

Question 11

When can an insurer not reject a claim for breach of a notification or other claim condidtion?

Answer 11

In the compulsory classes of motor and EL

Late reported claims will have to be met but the insurer may hve right of recovery from the insured

Question 12

In the event of a claim who does the burdon of proof of the loss sit with?

Answer 12

The insured
Must prove the loss was caused by an insured peril and the amount of the loss
Must be established on the balance of proabilities

Question 13

What type of acts by the insured will result in a rejected claim?

Answer 13

Deliberate acts
Loss must be accidental or fortuitous
Negligence and carelessness are covered

Question 14

Wnag are the ICOB rules around claims? (4)

Answer 14

Handle claims fairly & promptly
Provide reasonable guidance on how to claim
Not unreasonably reject a claim
Settle claims promptly once a settlement is agreed

Question 15

What remedies are available to PHs if the insurer is late with payment?

Answer 15

Used to be interest only

The Enterprise Act 2016 added a section to the IA 2015 to allow the courts to award damages for late payment (damages are in addition to the sum due and any interest on those sums)

Question 16

What are the main problems in relation to Causation?

Answer 16

Sometimes 2 perils (1 covered & 1 excluded) are linked and difficult to seperate

One peril could cause another - what if one is excluded?

Question 17

What does the MIA 1906 say anout causation?

Answer 17

Insurer is liable for any loss proximately caused by an insured peril
Not liable for any loss not proximately caused by an insured peril

Question 18

What are the basis that an insurer can write a policy?

Answer 18

Specified or named perils basis

All Risks basis

Question 19

Before the Leyland Shipping case what was considered to be the proximate cause in a loss?

Answer 19

The latest event in the chain, proximate in time, was the cause of the loss.

Now its proximate efficiency - determined by common sense

Question 20

What happens if there is one insured and one uninsured event and we cant establish which was the proximate cause?

Answer 20

The insured event wins and its deemed the loss was caused by an insured event

Question 21

What happens if there is one insured and one excluded event and we cant establish which was the proximate cause?

Answer 21

The exluded event wins and the insurer can reject liability

Question 22

What happens if there is one insured and one uninsured event, they combined to cause a loss, neither would have caused a loss on its own?

Answer 22

Full liability for the loss and insured peril prevails

Question 23

Who has the burdon of proof that the insured peril was the proximate cause?

Answer 23

The insured
However on an all risk policy the PH need only prove that the loss was accidental

Once proven by the insured, the insurer then has to prove otherwise if they want to reject the claim

Question 24

Can an insurer exclude some risks e.g. war absolutly?

Answer 24

Yes
Can rejrct claims where war is a remote cause
“Losses caused directly or indirectly” clause

Question 25

What are the 4 types of fraudulent claims?

Answer 25

Falsification of loss (no loss)
Deliberate loss
Exaggeration
Lying about the circumstance of a genuine loss

Question 26

What are fraudulent devices?

Answer 26

Fraudulent statements that are designed to increase the liklihood of a claim being paid