As a result of a breach of good faith under a commercial insurance policy, the insurer avoided the policy as a whole, but was NOT permitted to retain the premium because

• A. the misrepresentation was fraudulent.
• B. the misrepresentation was innocent.
• C. the premium was paid by monthly installments.
• D. no claim had been submitted or paid.

A warranty in Emily's personal travel insurance policy states that cash must be kept in a locked safe. Whilst on holiday, a storm destroys her hotel and its contents. When Emily completes a claim form for loss of money, she admits that her cash was NOT locked in the safe. What will be the insurer's likely response to her claim for the lost money?

• A. Pay the claim in full.
• B. Reject the claim for breach of warranty.
• C. Make an ex-gratia payment.
• D. Avoid the policy ab initio.

For this question more than 1 option is correct. You must select all the correct options to gain the mark. What are the characteristics of an express term in reaching or recording an agreement?

• A. It may be implied by conduct.
• B. It must be evidenced in documentary form.
• C. It may be oral or in writing.
• D. It will usually override any implied term which conflicts with it.

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. Lien.
• B. Trust.
• C. Coinsurance.
• D. Power of Attorney.

The proximate cause of a loss is best described as the

• A. most dominant cause of the loss.
• B. first peril to cause the loss.
• C. final peril to cause the loss.
• D. most remote cause of the loss.