Online Access Free M05 Exam Questions

In accordance with the principle of good faith, which facts must a potential policyholder disclose to the insurer when applying for insurance?

• A.Only those facts considered likely to reduce the cost of cover
• B.Any facts which are considered material to the risk.
• C.Any facts which are in the public domain.
• D.Any facts of law.

What type of reduction is sometimes applied to the replacement cost of an item under an insurance policy claim in order to reflect the application of indemnity?

• A.An excess.
• B.Brokerage.
• C.Loss of interest.
• D.Wear and tear.

Which of the following is a typical remedy for an insurer when the insured breaches a warranty?

• A.The insurer must continue to provide coverage, but with an increased premium
• B.The insurer may cancel the contract or refuse to pay a claim
• C.The insurer is obligated to reduce the payout amount based on the breach
• D.The insurer can sue the insured for breach of contract

According to statute law, an unfair term in a consumer insurance contract is defined as one which

• A.causes a significant imbalance in the parties' rights to the detriment of the consumer.
• B.has been individually negotiated and is to the detriment of either one of the parties.
• C.provides insurance where the scope of cover is narrow compared to the premium charged.
• D.does not restrict liability for death or personal injury.

What does the Consumer Insurance (Disclosure and Representations) Act 2012 require from consumers applying for insurance?

• A.Consumers are required to pay for claims made during the policy term.
• B.Consumers must disclose all material facts honestly and accurately.
• C.Consumers must answer questions about their past claims history.
• D.Consumers must choose an insurer based on premium prices alone.