Chapter 5 Flashcards
(7 cards)
List the main components of an insurance policy?
Comprises of: Heading Recital clause Signature Operative clauses Exclusions Conditions Policy schedule
What is the purpose of the operative clauses?
The operative clauses describe the scope of the cover in detail
Identify the policy conditions which are common to most general insurances
Common policy conditions are: Duties of the policy holder/insured Alteration Action by insured in the event of a claim Fraud Reasonable precautions Contribution Average Subrogation Arbitration Cancellation
What is the difference between compulsory excess and voluntary excess?
Compulsory is imposed on the insured by the insurer
Voluntary excess is accepted by the insured in return for a premium discount
What is a warranty?
A warranty is a promise made by the insured relating to facts or performance concerning the risk
Identify the 3 categories of policy conditions?
Conditions precedent to the contract
Conditions subsequent to the contract
Conditions precedent to liability
What is the purpose of the renewal notice?
A renewal notice brings to the insured’s attention the fact that the insurance contract is about to expire. The premium to renew the policy is shown on the renewal notice, including the rate of insurance premium tax (IPT) applying.
