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CII Examination element of M05 Insurance law Sample Questions:
1. According to statute, a term under a consumer personal accident insurance policy may potentially be considered unfair if the insurer
A) requires notification of a claim within a very short time period.
B) imposes a premium loading.
C) provides coverage that is more restrictive than that of other insurers.
D) applies a specific exclusion within the policy wording.
2. John owns stock that he intentionally insured for £15,000, although the full value of the stock is £18.000. His insurance policy has no excess and is subject to a pro rata condition of average. In the event of water damaging
£6.000 of John's stock, how much will the insurer pay for a valid claim after the application of average?
A) £15,000
B) £5,000
C) £3,000
D) £6,000
3. Within what time period, from the date when the damage first began, does the owner of an office block have a right to sue the builder for negligent construction work?
A) 15 years.
B) 3 years.
C) 9 years.
D) 6 years.
4. A property policy contains a condition regarding prompt loss notification. If the insured fails to comply with this condition, in practice, the insurer is likely to
A) only avoid the claim if the delay has seriously prejudiced its investigation and handling of the claim.
B) settle the claim and cancel the insurance policy from inception.
C) settle the claim and recover its outlay from the insured.
D) avoid the claim automatically due to the breach of the policy condition.
5. For this question more than 1 option is correct. You must select all the correct options to gain the mark.
The Insurance: Conduct of Business sourcebook (ICOBS) rules in respect of claims handling specify that an insurer must
A) not unreasonably reject an insured's claim.
B) handle a claims notification within 14 days.
C) provide reasonable guidance to an insured to help him make a claim.
D) settle a claim promptly once settlement has been agreed.
Solutions:
| Question # 1 Answer: A | Question # 2 Answer: B | Question # 3 Answer: B | Question # 4 Answer: D | Question # 5 Answer: A,C,D |




