Personal insurance products cover

Question 1

What 4 different levels of cover are available in motor insurance?

Answer 1

• Road Traffic Act (RTA) only
• Third party only
• Third party, fire and theft
• Comprehensive

Question 2

What does RTA cover provide?

Answer 2

• Unlimited indemnity for bodily injury or death caused third parties.
• Indemnity for loss or damage to third party property limited to £1,000,000.
• Indemnity for claimant’s costs and expenses.
• Charges for emergency medical treatment and hospital charges arising out of the use of the vehicle.

[RTA cover includes liability for injury to passengers travelling in the insured vehicle, or damage to their property, but not liability for damage caused by such passengers (e.g. through opening a door into the path of a passing car).]

Question 3

What does Third party only cover provide?

Answer 3

Everything RTA covers plus:

• Cover for vehicles whilst not on a road or other public place.
• A limit of £20 million for third party property damage.
• Indemnity for accidents caused while the insured is driving a car not belonging to them or their partner (the ‘driving other cars’ extension).
• Indemnity to passengers should they cause an accident.
• Legal costs in defending a claim.

Question 4

What does Third party, fire and theft cover provide?

Answer 4

Third party cover plus the cost of repairs or compensation if the insured vehicle, including its fitted accessories and spare parts, is:

• damaged by fire, lightning or explosion.
• damaged either during attempted theft or while it is stolen.
• stolen and not recovered.

Question 5

What does comprehensive cover provide?

Answer 5

In addition to what’s provided in third party fire and theft, cover is provided for accidental or malicious damage to the insured vehicle.

Cover typically extends to include limited personal accident benefits; medical expenses cover; loss or damage to rugs clothing and personal belongings in or on the car.

Question 6

What specific exclusions are private motor insurance subject to?

Answer 6

• Wear and tear
• Depreciation
• Loss of use
• Mechanical and electrical failure
• Tyre damage (punctures/blow outs).

Question 7

What general and market exclusions are private motor insurance subject to?

Answer 7

• Contractual liability
• War risks
• Use other than as specified
• Riot and civil commotion that happens outside Great Britain, the Isle of Man or the Channel Islands.
• Sonic bangs.

Question 8

What is Health Insurance separated into?

Answer 8

• Personal accident cover
• Sickness cover
• Medical expenses cover.

Question 9

In what circumstances can payments be made under personal accident policies (other than death)?

Answer 9

• Loss of limbs, eyesight, speech, hearing
• Permanent total disablement
• Permanent partial disablement
• Temporary total disablement
• Temporary partial disablement

Question 10

What is Permanent total disablement?

Answer 10

Permanent disability can be defined as a condition where recovery is not anticipated such as certain brain injuries or paralysis.

Most insurers require that the PTD occurs within an agreed period, i.e. 52 or 104 weeks of the accident date.

Question 11

What is Permanent partial disablement?

Answer 11

Permanent injuries that do not necessarily prevent the injured person returning to a relatively normal lifestyle, e.g. loss of finger or toes, can be classed as permanent partial disablement (PPD).

Insurers utilise a pre-set scale of benefits known as the continental scale to calculate lump sum payments.

Question 12

What is Temporary total disablement?

Answer 12

Temporary total disablement (TTD) is an injury that results in an insured person being unable to perform their usual job.

A weekly benefit is payable for each week of disability up to an agreed limit, usually 52 or 104 weeks. Most insurers incorporate a franchise before dealing with a claim, usually between 7, 14 or 21 days.

Question 13

What is Temporary partial disablement?

Answer 13

Temporary partial disablement

An injury that results in an insured person being unable to perform a substantial part of their usual job is classed as temporary partial disablement (TPD).

These instances cater for those persons that while unable to perform their normal job can still perform some sort of role at work. The usual weekly benefits payable are reduced to an agreed percentage, e.g. 30%, to reflect the fact that the person can still perform certain tasks.

Question 14

What standard exclusions are personal accident and sickness policies subject to?

Answer 14

• the insured being under the influence of, or being affected by, alcohol
• self-inflicted injury or disease
• childbirth, pregnancy, venereal disease or AIDS
• pre-existing illness or infirmity (unless notified to and cover agreed by the insurer)
• accidents while participating in motor cycling, racing of any kind (except on foot), winter sports and mountaineering, although some of these can be ‘bought back’ by payment of an additional premium.

Question 15

What does medical expenses insurance cover?

Answer 15

Private medical treatment outside the NHS, giving an individual a choice of specialist consultant, hospital and timing of treatment.

Question 16

What do typical in-patient medial expenses insurance cover include?

Answer 16

• hospital charges, including consultations; theatre fees and surgical dressings
• specialist fees (e.g. surgeons’ and anaesthetists’ fees)
• additional costs (e.g. ambulance and nursing fees).

Question 17

What is usually excluded under medical expenses insurance cover?

Answer 17

• long-term residential care
• Pre-existing conditions (where treatment has been administered previously - usually within five years prior to the date of cover commencing)

Question 18

What does household insurance cover?

Answer 18

Household policies cover buildings and/or contents against a wide range of perils.

Question 19

What does buildings insurance cover?

Answer 19

Loss or damage caused by:

Fire, lightning, explosion, earthquake
Riot, civil commotion, strikes
Malicious damage or vandalism
Storm or flood
Falling trees
Escape of water/oil
Theft or attempted theft
Impact
Subsidence, heave or landslip
Breakage of satellite dishes or aerials
Accidental damage to underground services
Accidental damage to glass and sanitary fittings
Legal, architect's and surveyors' fees, debris removal
Loss of rent.

Question 20

What extensions can be made to contents insurance cover?

Answer 20

• Temporary removal
• Clothing and personal goods of domestic servants
• Loss of rent
• Accidental damage to glass.

Question 21

What extensions can be made to personal insurance cover?

Answer 21

• personal possessions
• money and credit cards
• bicycles
• freezer contents
• caravans
• small craft
• sports equipment
• personal accident, hospital cash benefit and creditor insurance
• domestic animals
• legal expenses.

Question 22

What do standard Travel Insurance policies cover?

Answer 22

• baggage, personal effects and money
• personal liability
• delayed baggage
• personal accident benefits
• medical and associated expenses
• hospital cash benefits
• travel interruption
• travel delay
• loss of deposits

Question 23

What do standard Extended warranty insurance policies cover?

Answer 23

Insurance where buyers of mechanical and electrical goods extend their warranty.

Policies are available to cover all an insured’s electrical products. A typical sum insured is approximately £2,500 and all such policies are subject to certain exclusions.

Question 24

What are personal insurances?

Answer 24

Insurance arranged for private individuals acting outside their trade, business or profession.