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Insurance > 3.2 Principles of Insurance Law: Warranties and Conditions > Flashcards

3.2 Principles of Insurance Law: Warranties and Conditions Flashcards

1
Q

Under what part of IA can you contract out

A

16/17

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2
Q

What happens if one insurer pays more than his share, and others were also liable

A

He can get contribution from other insurers (80(2))

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3
Q

What happens if 2 CoIs have an escape clause

A

They cancel each other out

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4
Q

W as to facts are created through what 2 mechanisms in a CoI (including 1 allowed prior to IA)

A

Basis of C or CP

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5
Q

What case covers the ‘recover down’ principle for subrogated recovery in the case of underinsurance

A

Lord Napier v RF Kershaw

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6
Q

What are ‘bare conditions’ in CoI

A

Govern mechanics of CoI

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7
Q

Who can insured recover from, generally speaking, in the case of double insurance

A

Either insurer

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8
Q

What case showed automatic discharge of liability for BoW under MIA, but payment Os of insured continue

A

The Good Luck case

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9
Q

Could insured remedy the BoW to revive the contract under MIA

A

No - 34(2) MIA

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10
Q

What happens if there are 2+ dominant causes of loss and only one = insured peril

A

Must be of equal weight, but then covered

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11
Q

What is insurer likely to do if insured prejudices their rights

A

Refuse to pay claim and/or bring counterclaim for damages

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12
Q

What part of what Act stated that W need not be material, but did need to be exactly complied with (pre-IA)

A

33(3) MIA

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13
Q

What were the 3 tests in HIH Casualty

A

Go to root of the risk, describe or material to the risk, or damages unsatisfactory

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14
Q

Instead of automatic discharge of CoI for BoW, what happens under IA

A

Suspension of insurer’s Os until remedied (10)

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15
Q

What happens if there are 2+ dominant causes of loss and one is excluded?

A

Policy will not respond

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16
Q

What meaning are words given first

A

Ordinary, then technical, then see case law

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17
Q

What parts of what statutes abolished basis of C clauses

A

9 IA + 6 CI(DR)A

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18
Q

When might a 3rd party be worth pursuing in a surrogated claim

A

If insured

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19
Q

What is ‘average’

A

Insufficient insurance to cover entire cost of property - working out for what proportion insured if their own insurer

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20
Q

Three ways to create warranties

A

Expressly, impliedly and through basis of C clause

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21
Q

At CL, what must insurer do before can step into insured’s shoes and pursue 3rd

A

Pay insured in full

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22
Q

Why is it important that, if insured is suing 3rd, they also include insurers’ losses

A

Only a single cause of action can lead to a single claim for damages - cannot have multiple CoAs for single claim

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23
Q

What can insurer do if BoW (e.g. for goodwill)

A

Waive - equitable estoppel

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24
Q

The Good Luck case ratio

A

Insurer automatically discharged from liability for BoW under MIA, but payment Os of insured continue

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25
Q

3 cases when a subrogated claim cannot be brought

A

Insured has already brought claim, insured cannot bring claim, or other party is the insured/also insured by/benefits from the policy

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26
Q

HIH Casualty did what

A

Set down 3 tests for if W = W

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27
Q

What is contribution

A

More than one insurer covers same insured for same risk - each insurer contributes rateably to loss in proportion to risk

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28
Q

Three kinds of warranties

A

Continuing, as to facts, or of opinion

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29
Q

Breach of condition (that isn’t CP) = what

A

Damages

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30
Q

What is the effect of 11 IA applying to CPs

A

Breach of CP relating to particular loss unrelated to loss covered cannot be relied on to avoid paying claim

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31
Q

Lord Napier v RF Kershaw ratio

A

Recover down principle

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32
Q

What conditions are important

A

Condition precedents

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33
Q

W as to facts relate to what

A

past or present facts

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34
Q

What case set down 3-stage test for Ws to be Ws

A

HIH Casualty

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35
Q

What happened if BoW under MIA

A

Automatic discharge of liability and termination, w/o need for election

36
Q

What must there be a substantial overlap of for there to be double insuranc (x5)

A

Insured, risk, interest, policy period and subject matter

37
Q

Instead of automatic discharge of CoI for BoW, what happens under CI(DR)A

A

Suspension of insurer’s Os until remedied (10 IA applies)

38
Q

What rights does insurer assume when subrogating insured

A

Only insured’s rights against 3rd - so subject to exclusions

39
Q

Two kinds of subrogation

A

Recoup money recovered from insured from culpable 3rd, or step into insured’s shoes to pursue 3rd

40
Q

What case suggested that BoW in Proposal Form means no CoI ever came into existence (under MIA)

A

De Hahn v Hartley

41
Q

If creating Ws expressly, follow what case

A

HIH Casualty v New Hampshire

42
Q

What CL duty does an insured have generally regarding insurer’s rights

A

Not to prejudice their rights at any point

43
Q

From when does IA apply

A

12/08/2016

44
Q

Why must insured include the insurer’s losses as well when bringing claim against 3rd

A

Can only claim in insured’s name once against 3rd party

45
Q

What happens if there is underinsurance + recovery in surrogated claim?

A

Insured paid amount for which they insured themselves, insurer paid amount paid to insured, and insured recovers excess

46
Q

Insured should not make a profit from CoI - what case

A

Castellain v Preston

47
Q

Is it necessary to satisfy all 3 tests in HIH Casualty?

A

No - only one

48
Q

What is CP to liability

A

Insured must do X before insurer is liable for loss

49
Q

Who gets paid second under Lord Napier

A

Insurer for amount paid to insured

50
Q

What is an escape clause

A

Excluding liability in case of double insurance

51
Q

Which go to the root of CoI - warranties or conditions

A

Warranties

52
Q

After subrogation, when can insured keep a sum despite already being indemnified by insurer

A

If the sum goes above amount paid to them by the insurer

53
Q

Yorkshire v Nisbet ratio

A

After subrogation, insured can keep any sum above amount paid to them by the insurer

54
Q

What are continuing Ws

A

Promise of future conduct

55
Q

What is the doctrine that stops insurer relying on BoW to discharge/suspend when breach waived

A

Equitable estoppel

56
Q

What should you consider before exercising subrogation

A

If 3rd is worth pursuing

57
Q

Is terminology determinative for CPs

A

No

58
Q

When is W of opinion breached

A

If false AND dishonest/reckless

59
Q

Who is the BoP on for causation - dominant cause of loss = insured peril

A

Insured

60
Q

If W relates to a particular loss, what happens when BoW of that W under CI(DR)A

A

Need link between BoW + loss (as under IA) AND consumer aware of the term (ICOBS 8.1.2(3))

61
Q

What part of MIA applies to contribution

A

80 MIA

62
Q

BoW = what

A

Discharged or suspended CoI

63
Q

Two ways of impliedly waiving BoW

A

Accepting premiums or claims handling

64
Q

What part of IA applies to CPs

A

11 IA

65
Q

Can Ws be created impliedly in any case?

A

No - only in marine

66
Q

Who runs a claim before insurer entitled to subrogation

A

Insured

67
Q

What are some examples of when the insured cannot bring a claim, so no subrogation permitted

A

Limitation period, immunity under policy (i.e. policy does not allow subrogation), insured doesn’t exist

68
Q

Two kinds of CPs

A

CP as to risk and as to liability

69
Q

What is a rateable proportion clause

A

Requiring insured to claim from each insurer - each insurer only contributes rateably

70
Q

What does average mean in marine insurance

A

Loss - particular is partial, and general is when asset insured by one scarified to save assets insured by others

71
Q

De Hahn v Hartley ratio

A

CoI did not exist until W literally complied with

72
Q

What is CP to risk

A

Insured must do X before insurer goes on risk

73
Q

After subrogation, insured can keep any sum above amount paid to them by the insurer - case

A

Yorkshire v Nisbet

74
Q

What might a CoI have in it to avoid contribution

A

Escape, rateable proportion or excess clause

75
Q

What is an example of when the other party is the insured so no subrogation allowed

A

1 owner of 2 assets that caused loss, e.g. boats colliding

76
Q

Sum for working out average

A

(Sum insured / value of property) x loss = claims payment

77
Q

Where defined Ws pre-IA

A

33(1) MIA

78
Q

If one insurer has RP clause, and other escape + excess clause, RP clause triggered (and exhausted) first - WHAT CASE?

A

NFU v HSBC

79
Q

Who gets paid third under Lord Napier

A

Insured for the excess paid

80
Q

Who gets paid first under Lord Napier

A

Insured for amount they insured themselves

81
Q

What is an excess clause

A

Turns insurance into excess policy - only responds once other policy exhausted

82
Q

NFU v HSBC ratio

A

If one insurer has RP, and other escape + excess, RP clause triggered (and exhausted) first

83
Q

What condition of subrogation is usually excluded under CoI

A

Need to pay insured in full before rights can be exercised

84
Q

Castellain v Preston laid down what principle

A

Insured should not make a profit from CoI

85
Q

If insured decides to claim from culpable 3rd after being indemnified, what losses should insured include

A

Both insured and its own uninsured losses

86
Q

If W relates to a particular loss, what happens when BoW of that W under IA

A

Must be link between breach + loss actually suffered to rely (11)

Insurance (7 decks)

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