CHAPTER 4 Insurable Interest Exam Style Questions 5% OF THE EXAM

What is insurable interest? A financial relationship with the subject matter of insurance A legally recognised relationship with the subject matter of insurance A legally recognised financial relationship with the subject matter of insurance arising out of ownership

What is the subject matter of the insurance? The financial interest in the subject matter of the contract The policy document The premium to be paid by the insured The property, life or liability insured

Which of these is impossible to insure? Cancellation of an event caused by bad weather Future loss of earnings Potential theft of money by dishonest employees Sentimental value of wedding photographs

Jill recently sold her 3 month old car to Jack and no longer owns, drives it or looks after it. She forgot to cancel her motor insurance and has just learned that Jack damaged the car beyond repair in a motor accident. If she makes a claim under her own motor policy what can she expect to receive? Current cost of replacing the car with a new one Current market value of the car Nothing The original purchase price of the car

What is the maximum amount of insurable interest that a married person has in the life of his/her spouse? Funeral expenses only The value of his/her financial dependency on the assured life It is unlimited The amount of any outstanding loans or other debts that will have to be paid off

When must insurable interest be present in Life Assurance contracts? At the time of any claim At inception only At inception and the time of any claim Throughout the duration of the contract

When must insurable interest be present in Marine Insurance contracts? At the time of any claim At inception only At inception and the time of any claim Throughout the duration of the contract

When must insurable interest be present in General Insurance contracts? At the time of any claim At inception only At inception and the time of any claim Throughout the duration of the contract