E05 Actual Questions - Instant Download 52 Questions
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CII E05 exam covers a range of topics, including the legal framework for insurance, the principles of insurance contract law, the regulation of insurance business, and the rights and duties of insurers and policyholders. Candidates will also be expected to demonstrate an understanding of the legal and regulatory requirements surrounding claims handling and settlement, as well as the legal remedies available to policyholders in the event of a dispute with their insurer.
CII E05 certification exam is a challenging assessment that requires extensive preparation and knowledge of the subject matter. Candidates must have a solid understanding of insurance law and its applications in various contexts. They must also be able to apply this knowledge to real-life situations to provide effective solutions to clients' insurance needs.
Achieving a pass in the CII E05 exam is a significant achievement and is highly respected within the insurance industry. It is also a requirement for anyone looking to progress to higher-level qualifications within the CII, such as the Diploma in Insurance. E05 exam is open to anyone who meets the CII's eligibility criteria, which includes having a good understanding of the English language and having a basic knowledge of insurance principles. With the help of thorough preparation and study, candidates can give themselves the best possible chance of passing the CII E05 exam and advancing their career in the insurance industry.
NEW QUESTION # 30
When, if at all, does the duty of fair presentation of a risk apply after a non-consumer insurance contract has been formed?
- A. On submission of a claim.
- B. It does not apply as the duty is to take reasonable care not to make a misrepresentation.
- C. Where there is a variation in the insured risk.
- D. From the date of a breach of warranty.
Answer: C
NEW QUESTION # 31
The test of the materiality of facts in an insurance contract is defined according to the opinion of a
- A. prudent underwriter.
- B. diligent broker.
- C. reasonable person.
- D. honest proposer.
Answer: A
NEW QUESTION # 32
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. £15,000
- B. £5,000
- C. £6,000
- D. £3,000
Answer: B
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. Lien.
- B. Power of Attorney.
- C. Coinsurance.
- D. Trust.
Answer: D
NEW QUESTION # 34
Why may an insurer insert a continuing warranty into an insurance policy?
- A. To maintain the annual aggregate limit of liability throughout the policy period.
- B. To encourage good risk management by the insured throughout the policy period.
- C. To enable an insurer to charge an additional premium if the warranty is continually breached.
- D. To ensure that underinsurance is avoided at all times.
Answer: B
NEW QUESTION # 35
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. Reduce the claim amount in proportion to the premium it would have charged.
- B. Apply any terms it would have applied if the misrepresentation had not taken place.
- C. Reject the claim, but maintain the policy.
- D. Avoid the contract, refuse all claims and keep the premium.
Answer: A,B
NEW QUESTION # 36
Which divisional court of the High Court includes a Commercial Court?
- A. Chancery Division.
- B. Queen's Bench Division.
- C. Family Division.
- D. Partnership Division.
Answer: A
NEW QUESTION # 37
A claimant may possibly recover money transferred under an illegal contract when
- A. the illegality makes the contract voidable rather than void.
- B. both parties to the contract are equal in wrongdoing.
- C. the contract is against public policy but not substantive law.
- D. the legal portion of the contract can be severed from the illega portion.
Answer: B
NEW QUESTION # 38
What are the main objectives of the principle of insurable interest?
- A. To reduce moral hazard and to discourage profiteering.
- B. To reduce moral hazard and to discourage wagering.
- C. To reduce physical hazard and to discourage profiteering.
- D. To reduce physical hazard and to discourage wagering.
Answer: B
NEW QUESTION # 39
A professional indemnity policy includes a condition requiring that the insured must give prompt notice of any circumstance that could give rise to a claim. What type of condition is this?
- A. A condition precedent to the contract.
- B. A condition precedent to liability.
- C. A collateral condition.
- D. A suspensive condition.
Answer: B
NEW QUESTION # 40
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 # 41
What is the intended purpose of a subrogation waiver clause in an insurance po
- A. The insurer's subrogation rights will not be exercised against certain parties associated with the insured.
- B. The doctrine of subrogation is excluded from the policy.
- C. The insured has a duty to ensure that the insurer's subrogation rights are maintained.
- D. Cover is suspended whilst the insurer pursues an action for subrogation.
Answer: A
NEW QUESTION # 42
A married couple have equal shares in a property and are insured under a buildings insurance policy. What is the likely position in law of a breach of good faith by one party, which was unknown to the other party?
- A. Cover would be maintained in full for the innocent party as the cover is likely to be a composite policy.
- B. Cover for both parties would be invalidated as the cover is likely to be a composite policy.
- C. Cover would be maintained in full for the innocent party as the cover is likely to be a joint policy
- D. Cover for both parties would be invalidated as the cover is likely to be a joint policy.
Answer: D
NEW QUESTION # 43
Within what time period, from the date when the damage first began, does the owner of an office block have a right to sue the builder for negligent construction work?
- A. 6 years.
- B. 15 years.
- C. 9 years.
- D. 3 years.
Answer: D
NEW QUESTION # 44
In what circumstances is abandonment automatic under a marine hull insurance policy?
- A. The actual total loss of the vessel.
- B. The constructive total loss of the vessel.
- C. The insured has performed an action of abandonment.
- D. The insured has sent a formal notice of abandonment.
Answer: A
NEW QUESTION # 45
Tim is a local insurance broker. He has authority to receive premiums for a personal lines insurer and earns commission from the insurer for sales. Paul, an elderly customer, asked Tim for advice regarding his personal insurance requirements and to assist with completing the proposal form for household insurance. In these circumstances, who, if anyone, is Tim's principal?
- A. Paul as it is a consumer contract.
- B. Both the insurer and Paul at different times.
- C. No one as Tim is not a party to the insurance contract.
- D. The insurer at all times.
Answer: D
NEW QUESTION # 46
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 cancel the insurance policy from inception.
- C. settle the claim and recover its outlay from the insured.
- D. avoid the claim automatically due to the breach of the policy condition.
Answer: D
NEW QUESTION # 47
The principle of subrogation prevents a policyholder from profiting from
- A. assigning abandonment rights to the insurer.
- B. claiming under both his insurance policy and against any negligent third party.
- C. submitting a full claim recovery under more than one insurance policy.
- D. retaining salvaged property.
Answer: B
NEW QUESTION # 48
What is the maximum contingency fee percentage under a damages-based agreement that can be charged by a solicitor for personal injury cases and employment tribunal cases respectively?
- A. 50% for both cases.
- B. 35% for both cases.
- C. 35% for personal injury cases and 25% for employment tribunal cases.
- D. 25% for personal injury cases and 35% for employment tribunal cases.
Answer: D
NEW QUESTION # 49
At what stage is insurable interest required for a marine cargo insurance policy?
- A. At the time of the loss only.
- B. At both inception of the policy and at the time of the loss.
- C. At inception of the policy only.
- D. Throughout the duration of the contract.
Answer: A
NEW QUESTION # 50
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