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CII M05 Exam Syllabus Topics:

SectionObjectives
Subrogation and Contribution- Recovery rights and sharing of losses
  • 1. Contribution
  • 2. Subrogation
Nature and Sources of English Law and Legal Persons- Nature and sources of English law
  • 1. Statute law
  • 2. Common law
  • 3. European and international influences
- Legal personality
  • 1. Juristic persons
  • 2. Natural persons
Indemnity and Loss Measurement- Principle of indemnity
  • 1. Valuation of loss
  • 2. Methods of indemnification
Law of Agency and Insurance- Agency relationships
  • 1. Duties and liabilities
  • 2. Authority of agents
  • 3. Creation of agency
Law of Torts- Principles of tort law
  • 1. Trespass
  • 2. Negligence
  • 3. Nuisance
Law of Contract- Contract formation and operation
  • 1. Terms of contract
  • 2. Breach of contract
  • 3. Consideration
  • 4. Offer and acceptance
Formation of Insurance Contracts- Core insurance principles
  • 1. Disclosure and misrepresentation
  • 2. Insurable interest
  • 3. Utmost good faith
Insurance Claims- Claims process and legal principles
  • 1. Claims handling
  • 2. Policyholder duties
  • 3. Claims notification
Insurance Contract Terms and Vitiating Factors- Factors affecting validity
  • 1. Non-disclosure
  • 2. Fraud
  • 3. Misrepresentation
- Policy terms and breaches
  • 1. Representations
  • 2. Conditions
  • 3. Warranties

CII Insurance law (IL) Sample Questions:

Question 1

For this question more than 1 option is correct. You must select ail the correct options to gain the mark.
In what circumstances does the Fires Prevention (Metropolis) Act 1774 require insurance companies to ensure that claims monies are used to rebuild or reinstate buildings destroyed or damaged by fire?

A. When fraud or arson by the insured is suspected.
B. Where the building was destroyed by an explosion.
C. Where there is underinsurance.
D. Upon the request of any person(s) interested in the buildings.


Question 2

An employee suffered a minor injury lo his arm at work, due to a breach of duty by his employer. The medical treatment he received at hospital was negligent and caused his minor injury to deteriorate to the extent that his arm had to be amputated. To what extent, if at all, is the employer liable?

A. The employer will not be liable for the employee's injuries at all
B. The employer and the hospital will split liability on an equal basis
C. The employer will not be held liable for the unforeseeable extent of the employee's injuries
D. The employer will be held strictly liable for the full extent of the employee's injuries


Question 3

What are the main reasons why the law requires insurable interest to exist?

A. Reduce physical hazard and discourage gambling.
B. Discourage underinsurance and ensure premium adequacy.
C. Reduce moral hazard and discourage gambling.
D. Discourage betterment and ensure premium adequacy.


Question 4

What is the principal reason for which a proposer is asked by the insurer whether his car will be driven by anyone else?

A. To enable a loading to be applied.
B. To establish whether insurable interest exists.
C. To enable a discount to be applied.
D. It is a material circumstance.


Question 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. settle a claim promptly once settlement has been agreed.
D. provide reasonable guidance to an insured to help him make a claim.


Solutions:

Question 1
Answer: A,D
Question 2
Answer: D
Question 3
Answer: C
Question 4
Answer: D
Question 5
Answer: A,C,D

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