Principles of insurance law

Question 1

What is a contract of ensurance

Answer 1

The agreement of one party to pay the other when an event happens, provide an equivalent benefit or make payments to the other untill such an event happens in exchange for a consideration payed.

Question 2

What are the two types of insurance contracts

Answer 2

Indemnity insurace or contingency insurance

Question 3

What is indemnity insurance

Answer 3

When the undertaking is to pay an indemnity against a potential loss or liability of the insured, f.ex fire and car ensurance

Question 4

What is contingency insurance

Answer 4

When a specific sum is to be payed regardless of the cost of the event, The sum may also be payed imediately in exchange for periodic payments in the future

Question 5

It is of an insurance contracts essance that the event insured is uncertain

Answer 5

Yes, so perishable goods or self inflicted damages

Question 6

Public policy may pervent a person from receiving insurance payments

Answer 6

True

Question 7

A person can take out a life insurance for a strangers life

Answer 7

False, an insurance contract must be taken out for the persons own interest (insurable interest)

Question 8

Anyone can conduct business as an insurer

Answer 8

False, they must be aproved by the financial conduct authority FCA, they among other things regulate that the contract is user firendly and not full of legal technocalites

Question 9

What does it mean that an insurance contract is uberrimae fidei

Answer 9

That it is a contract of utmost fidelity and that the insured must disclose all the rellevent information that they are aware of before the contract is signed (a fair presentation of risk)

Question 10

When may an insured not provide relevant information

Answer 10

If the secret deminishes the risk, if the insurer knows ought to know or is persumed to know or if the insurer waives the information

Question 11

An insurer can decline to provide insurance if utmost good faith was not observed

Answer 11

Not always, if the failure to inform was not deliberate nor reckless there are other remedies by the 2015 act

Question 12

All that can effect the judgement of a prudent insurer must be disclosed before an insurance contract

Answer 12

True, this includes unfounded rumors

Question 13

What is the contra conferentum rule

Answer 13

That each term of the contract should be interpreted in a manner least favorable to the one who has written it (usually the insurer)

Question 14

A condition in an insurance contract may refer to something to be done after the contract is signed

Answer 14

True

Question 15

What is a warrenty in an insurance contract

Answer 15

An undertaking given by the insured which formed the basis of the contract and releases the insurer of any obligation automatically (at least durring the breach or consequences of the breach period) if not fufilled f.ex the truthful answer of a question

Question 16

If the insured can prove that compliance with the warrenty did not decrease the risk of gaining the claim they sought they may still be compensated

Answer 16

True, so a lack of a burglury alarm may not be the cause of withholding storm insurance even if such was a required warrenty. Although this clause can be contracted out of as long as the term is clear and unambigous.

Question 17

The insured has often not a duty to inform the insurer in short notice of a loss

Answer 17

False

Question 18

the burden of onus is on the insured

Answer 18

True, they must prove that they have lost

Question 19

The burden of onus regarding noncompliance with the contract lies with the insurer

Answer 19

True

Question 20

Can a person or company make an insurance contract for employees or relatives

Answer 20

Yes and these will be able to claim insurance in their own name

Question 21

What rights does an insurer against and indemnity have

Answer 21

Salvage, subrogation and contribution

Question 22

What is the right of salvage under indemnity insurance

Answer 22

That if the ensurer compensates the full value of property before an event they gain ownership of what remains after the compensation

Question 23

What is the rights of subrogation under an indemnity insurance

Answer 23

That the insured has no right to more than the full indemnity of their loss and that the insurer gains all rights related to the lost property and to stand in the insureds shoes and can f.ex sue a third party who is liable for the destruction in tort

Question 24

What is the rights of contribution under an indemnity insurance

Answer 24

If an insured has taken out more then their indemnity but has mutliple insurers the one that has lost more then they shall may take a contrinution from other insurers

Question 25

Marine insurance has no differences from other types of insurance

Answer 25

False, one difference is that it must be recoreded in a written policy

Question 26

An insurance claim must be made by the insured

Answer 26

True

Question 27

An insurance claim must be made in reasonable time so that the evidence of the loss is not obscured

Answer 27

True

Question 28

What may happen if an insured reports a fradulent claim

Answer 28

the insurer may decline to pay, retake their payment, disband the contract while keeping all past premiums depending on the contract