Chapter 1

Question 1

What department can be seen as the shop window

Answer 1

Claims Department

Question 2

Implied Duty

Answer 2

Imposed by common law

Question 3

Pawsey v Scottish Union and National (1907)

Answer 3

Proximate cause

Question 4

who is responsible for proving the claim is valid?

Answer 4

Insured (onus of proof)

Question 5

To establish the proximate cause of a loss and determine policy liability, the insurer will:

Answer 5

Look at the relationship between the peril and the loss

Question 6

Who will normally be involved in a large and complex claim?

Answer 6

A loss adjustor

Question 7

Under common law, the insured has a duty to:

Answer 7

Take all reasonable steps to minimise the loss

Question 8

What type of expert may be used to estimate rebuilding costs, as part of the claims investigation process?

Answer 8

Surveyors

Question 9

Under a first notification of loss process, what is usually the first step of the claims process?

Answer 9

The insured contacts the insurer via telephone or online form

Question 10

buildings and contents insurance. If she has a theft but fails to notify the police, what action is her insurer most likely to take?

Answer 10

Refuse to pay claim

Question 11

What is the amount of a claim known as?

Answer 11

Quantum

Question 12

Most insurers operate a first notification of loss process. With a low value claim on a motor insurance policy, what action is the policyholder LEAST likely to take?

Answer 12

Complete and sign a written claim form

Question 13

Under the principle of ‘indemnity’, if Mia has made a claim on her household insurance policy:

Answer 13

Her insurer must ensure that she is returned to the same financial position she had before the loss.

Question 14

Lynne has a household policy. One night there are high storm conditions and some slates are blown off her roof. What is the first action Lynne should take?

Answer 14

Arrange for the roof to be secured immediately

Question 15

Which clause states that in the case of under-insurance, the amount paid will be reduced in proportion to the amount of under-insurance?

Answer 15

Average

Question 16

What is the definition of an excepted peril under an insurance policy?

Answer 16

One that is specifically not covered

Question 17

insured perils

Answer 17

those named in the policy as covered

Question 18

uninsured or unnamed perils

Answer 18

those perils not referred to in the policy and therefore not insured

Question 19

Which legislation requires an insurer to ensure that its insurance contracts are fair by being clear and understandable?

Answer 19

Consumers Rights Act 2015

Question 20

When a claim is made on an insurance policy, the insurer will seek to establish the dominant cause for the loss before deciding whether the claim is valid. This is known as the principle of:

Answer 20

Proximate cause

Question 21

If a condition precedent to liability is breached, how will the insurer react to a connected claim?

Answer 21

Repudiate the claim but keep the contract in force

Question 22

In which part of the insurance policy would the policyholder’s express duties usually be detailed?

Answer 22

Policy Conditions

Question 23

With a property insurance claim, the:

Answer 23

insured must prove that an insured peril arose and the amount of the loss.

Question 24

Under what circumstance might an insurance claim be subject to the principle of ‘averaging’?

Answer 24

Where there is under insurance

Question 25

Steve is on holiday and his wallet is stolen. To whom must he report the theft to support the claim under his travel policy?

Answer 25

The police in the locality of the theft

Question 26

When Patrick took out household insurance, there was a condition that he must fit an approved burglar alarm. He failed to do so and this came to light when he submitted a valid claim for a fire in his kitchen. How would the insurer treat the claim for the fire?

Answer 26

It would pay for the claim

Question 27

Jamie has a comprehensive motor insurance policy. He is involved in an accident in his brand new car, which results in the vehicle being written off. What document will his insurer insist is returned to it before settling the claim?

Answer 27

Vehicle registration document

Question 28

With household insurance policies, within what timescale is the policyholder normally required to notify the insurer of a claim?

Answer 28

Promptly

Question 29

When dealing with a standard motor insurance claim, the claim handler will check the details on the claim form against the original application form. This is to check that:

Answer 29

All material information was notified to the underwriters at the start of the policy

Question 30

For what type of insurance claim would the policyholder normally have to only prove that an insured peril had occurred?

Answer 30

Liability claims

Question 31

Express conditions

Answer 31

Stated in the policy

Question 32

Implied conditions

Answer 32

one that is accepted as applying to the policy, but is not actually stated in the policy wording

Question 33

Express duties

Answer 33

These are always written into the contract