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CII E05 certification exam is an essential tool for insurance professionals looking to enhance their knowledge and understanding of insurance law and regulation. It provides a valuable opportunity for professionals to demonstrate their expertise, enhance their career prospects, and improve their credibility within the industry. With its broad range of topics, the exam is suitable for a wide range of professionals across the insurance sector, making it an excellent investment for anyone looking to develop their skills and knowledge in this area.
CII E05 is an examination element of M05 Insurance law that is designed to test a candidate's knowledge of insurance law and regulation. E05 exam is one of the requirements for obtaining the Diploma and Advanced Diploma in Insurance, and it is also recommended for those who wish to develop their expertise in this area.
NEW QUESTION # 17
Ambiguous terms in a household insurance contract are generally construed against the
- A. policyholder due to the noscitur a sociis rule.
- B. policyholder due to the literal rule.
- C. insurer due to the ejusdem generis rule.
- D. insurer due to the contra proferentem rule.
Answer: D
NEW QUESTION # 18
John owns stock that he intentionally insured for £15,000, although the full value of the stock is £18.000. His insurance policy has no excess and is subject to a pro rata condition of average. In the event of water damaging
£6.000 of John's stock, how much will the insurer pay for a valid claim after the application of average?
- A. £3,000
- B. £6,000
- C. £15,000
- D. £5,000
Answer: D
NEW QUESTION # 19
Dan made a financial arrangement on behalf of Liz. However, Liz had the arrangement set aside by the court on the basis that she had been unduly influenced by Dan. To establish undue influence, the court must have specifically identified Dan as
- A. Liz's independent financial adviser.
- B. a person holding a senior position at Liz's bank.
- C. Liz's husband.
- D. a person holding a dominant position over Liz.
Answer: D
NEW QUESTION # 20
Insurance agencies are usually created by way of
- A. express agreement.
- B. deed of agreement.
- C. implied agreement.
- D. unilateral agreement.
Answer: A
NEW QUESTION # 21
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. Where the building was destroyed by an explosion.
- B. Upon the request of any person(s) interested in the buildings.
- C. Where there is underinsurance.
- D. When fraud or arson by the insured is suspected.
Answer: B,D
NEW QUESTION # 22
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. settle a claim promptly once settlement has been agreed.
- B. handle a claims notification within 14 days.
- C. not unreasonably reject an insured's claim.
- D. provide reasonable guidance to an insured to help him make a claim.
Answer: A,C,D
NEW QUESTION # 23
Bill owned a painting which was insured under a policy containing a first refusal clause. The painting was stolen and Bill's claim was settled, but several months later the painting was recovered by the police. As a consequence, what is Bill's position under his insurance policy?
- A. Bill may exercise an option to buy the painting back.
- B. Bill may keep the claim settlement and also keep the painting.
- C. Bill must return the claim settlement in exchange for the painting.
- D. Bill must buy the painting back.
Answer: A
NEW QUESTION # 24
For this question more than 1 option is correct. You must select all the correct options to gain the mark. In a consumer insurance policy, a warranty can arise as
- A. an exception clause.
- B. a basis of the contract clause.
- C. a continuing warranty.
- D. an express term.
Answer: B,D
NEW QUESTION # 25
A property policy contains a condition regarding prompt loss notification. If the insured fails to comply with this condition, in practice, the insurer is likely to
- A. only avoid the claim if the delay has seriously prejudiced its investigation and handling of the claim.
- B. settle the claim and recover its outlay from the insured.
- C. settle the claim and cancel the insurance policy from inception.
- D. avoid the claim automatically due to the breach of the policy condition.
Answer: D
NEW QUESTION # 26
A household insurance policyholder leaves his home to go to work without setting the burglar alarm. Whilst he was out, his new tumble dryer overheats and causes fire damage to the kitchen. In what circumstances may the insurer legally reject a fire claim?
- A. If there is a breach of a warranty requiring the burglar alarm to be set.
- B. If the tumble dryer is covered by extended warranty insurance.
- C. If there is a subrogation action against the manufacturer of the tumble dryer.
- D. If the policyholder exaggerates the value of the claim.
Answer: D
NEW QUESTION # 27
For this question more than 1 option is correct. You must select all the correct options to gain the mark.
A proposer for private motorcycle insurance carelessly states the motorcycle's engine capacity as 500cc when in fact it is 1500cc. A policy is issued by the insurer on this basis. In the event of a valid claim causing damage to the motorcycle, what potential remedies are available to the insurer under the Consumer Insurance (Disclosure and Representations) Act 2012?
- A. Reject the claim, but maintain the policy.
- B. Apply any terms it would have applied if the misrepresentation had not taken place.
- C. Avoid the contract, refuse all claims and keep the premium.
- D. Reduce the claim amount in proportion to the premium it would have charged.
Answer: B,D
NEW QUESTION # 28
What are the main objectives of the principle of insurable interest?
- A. To reduce moral hazard and to discourage profiteering.
- B. To reduce physical hazard and to discourage wagering.
- C. To reduce moral hazard and to discourage wagering.
- D. To reduce physical hazard and to discourage profiteering.
Answer: C
NEW QUESTION # 29
Who is entitled to the surplus if a subrogation recovery from a negligent third party is greater than the amount the insurer has paid to the insured?
- A. The insured only.
- B. The State
- C. It is shared between the insurer and the insured.
- D. The insurer only.
Answer: A
NEW QUESTION # 30
A claimant may possibly recover money transferred under an illegal contract when
- A. the legal portion of the contract can be severed from the illega portion.
- B. the contract is against public policy but not substantive law.
- C. both parties to the contract are equal in wrongdoing.
- D. the illegality makes the contract voidable rather than void.
Answer: C
NEW QUESTION # 31
Adam was bitten by a stray dog in Africa. He washed his wound in a pond and a week later he became very ill with a high temperature. Initially, the local hospital treated him for malaria and later treated him for the fever following the dog bite. Adam died in hospital. What is the proximate cause of his death?
- A. The original physical injury of the dog bite.
- B. The delay in obtaining the correct medical treatment.
- C. The unhygienic washing of the dog bite.
- D. The delay in seeking medical treatment.
Answer: A
NEW QUESTION # 32
For this question more than 1 option is correct. You must select fill the correct options to gain the mark. In what circumstances would an agency agreement be automatically terminated?
- A. Bankruptcy of the principal.
- B. Disclosure of the name of the principal.
- C. Death of the agent.
- D. Bankruptcy of the agent.
Answer: A,C
NEW QUESTION # 33
A person insures her own life under a life insurance policy but does so expressly for the benefit of another. To facilitate this, which type of arrangement is most commonly established?
- A. Power of Attorney.
- B. Coinsurance.
- C. Trust.
- D. Lien.
Answer: C
NEW QUESTION # 34
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CII E05 exam is structured to test the candidate's understanding of insurance law from a legal perspective. It covers various topics such as the legal system, the principles of insurance contracts, the law of agency, and the regulation of insurance. E05 exam aims to assess the candidate's ability to apply these principles to real-life scenarios and to demonstrate an understanding of how insurance law operates in practice.
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