Get 100% Passing Success With True M05 Exam! [Sep-2025]

CII M05 PDF Questions - Exceptional Practice To Insurance law (IL) Exam

NEW QUESTION # 68
The Chancery Division is a division of the:

• A. Magistrates Court.
• B. County Court.
• C. Crown Court.
• D. High Court.

Answer: D

Explanation:
The Chancery Division is one of the three divisions of the High Court in the United Kingdom, dealing with matters such as business law, trusts, and intellectual property.

NEW QUESTION # 69
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. 25% for personal injury cases and 35% for employment tribunal cases.
• B. 35% for both cases.
• C. 50% for both cases.
• D. 35% for personal injury cases and 25% for employment tribunal cases.

Answer: A

NEW QUESTION # 70
What happens if an insured party fails to disclose a material fact during the application process for an insurance policy?

• A. The insurer may reduce the coverage limits
• B. The insurer may void the contract if the omission is deemed significant
• C. The insurer will continue to provide coverage without any adjustments
• D. The insurer may charge a higher premium

Answer: B

Explanation:
Failure to disclose material facts (facts that would influence the insurer's decision to offer coverage) can lead to the voiding of the policy under the principle of utmost good faith.

NEW QUESTION # 71
According to statute, a term under a consumer personal accident insurance policy may potentially be considered unfair if the insurer

• A. imposes a premium loading.
• B. requires notification of a claim within a very short time period.
• C. applies a specific exclusion within the policy wording.
• D. provides coverage that is more restrictive than that of other insurers.

Answer: B

NEW QUESTION # 72
If a proposer has failed to fully answer a question on a proposal form, the insurer is deemed to have waived its rights to this information because it

• A. did not request further information.
• B. should be able to underwrite the risk based on the information already provided.
• C. has statistics on similar risks.
• D. does not have the right to ask the proposer for more information.

Answer: A

NEW QUESTION # 73
Which of the following is true about insurable interest?

• A. The policyholder must have an interest in the property at the time of policy purchase but not at thetime of loss
• B. The policyholder must have a financial stake in the property or event insured at the time of loss
• C. Insurable interest is only required for life insurance policies
• D. Insurable interest must always be proven at the time the policy is issued

Answer: B

Explanation:
interestrefers to the requirement that the policyholder must stand to suffer a financial loss from the event insured. In most cases, this must be proven at the time of loss, not just when the policy is issued.

NEW QUESTION # 74
What does the Consumer Insurance (Disclosure and Representations) Act 2012 require from consumers applying for insurance?

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

Answer: C

Explanation:
Under the Consumer Insurance (Disclosure and Representations) Act 2012, consumers are required to disclose material facts that could affect the insurer's decision to provide coverage. However, unlike the previous law, it does not require consumers to disclose every fact, but only material facts.

NEW QUESTION # 75
Which of the following is a feature of an insurance contract under the principle of "utmost good faith"?

• A. The insured must disclose all material facts relevant to the risk.
• B. The insurer must be transparent about the terms of the policy.
• C. The insurer must pay all claims, regardless of the terms of the policy.
• D. Both parties must agree on the premium amount in advance.

Answer: A

Explanation:
Under the principle of utmost good faith (also known as "uberrimae fidei"), the insured must disclose all material facts to the insurer that could affect the insurer's decision to provide coverage or the terms of the policy.

NEW QUESTION # 76
In respect of a life assurance policy, the duty to take reasonable care NOT to make a misrepresentation ends when the proposer

• A. dies and his estate submits a claim to the insurer.
• B. signs and submits the completed proposal form to the insurer.
• C. assigns the contract to a third party.
• D. forms the contract with the insurer.

Answer: D

NEW QUESTION # 77
What is the basis of settlement under a new for old insurance policy if a television is stolen?

• A. The replacement cost in full.
• B. The original cost, less wear and tear.
• C. The original cost in full.
• D. The replacement cost, less wear and tear.

Answer: D

NEW QUESTION # 78
A breach of warranty under the general law of contract legally entitles an injured party to

• A. avoid the contract from the date of the breach.
• B. avoid the contract ab initio.
• C. obtain specific performance.
• D. claim damages.

Answer: D

NEW QUESTION # 79
In an insurance policy arranged through an insurance broker the parties to the contract are the:

• A. insurance broker only
• B. insured and the insurer only
• C. Insurance broker and the insured only
• D. insured only

Answer: B

NEW QUESTION # 80
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 for both parties would be invalidated as the cover is likely to be a joint 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 composite policy.
• D. Cover would be maintained in full for the innocent party as the cover is likely to be a joint policy

Answer: A

NEW QUESTION # 81
A nurse working shifts is regularly disturbed by her neighbour givig brass instrument lessons in Ihe evenings.
She is tired and losing concentration at work but is NOT at risk of losing her job. What remedy can be provided by equity as an alternative source of law to common law?

• A. General damages.
• B. An injunction.
• C. Punitive damages.
• D. Specific performance

Answer: B

Explanation:
In this case, the nurse is facing a disturbance from her neighbor, which is affecting her concentration and well- being. Aninjunctionis an equitable remedy that could be used to stop the neighbor from causing the disturbance, either temporarily (atemporary injunction) or permanently (apermanent injunction). This is often used to prevent ongoing nuisance or harm, like in this situation where the noise is impacting the nurse's ability to work.
Specific performance (A) would typically apply to compelling someone to fulfill a contractual obligation, not for stopping a nuisance. Punitive damages (B) and general damages (C) are not equitable remedies but are more common in common law for compensating harm or punishment.

NEW QUESTION # 82
What is the most common for of corporation?

• A. Corporation sole.
• B. Chartered corporation.
• C. Statutory corporation.
• D. Registered corporation.

Answer: D

NEW QUESTION # 83
Which of the following is an example of a condition precedent in an insurance contract?

• A. The insurer must provide coverage for accidental damage
• B. The insured must maintain the insured item in good condition
• C. The insurer is required to pay claims for theft
• D. The insured must pay the premium

Answer: B

Explanation:
A condition precedent is an obligation that must be met before the insurer becomes liable for a claim. For example, the insured might need to maintain property in good condition or comply with safety measures before coverage applies.

NEW QUESTION # 84
How can an agency relationship be best described?

• A. A person has the authority to act on behalf of another party.
• B. A person, who has paid another party under a contract, has the right to stand in the place of that other party and avail himself of the rights and remedies of that party.
• C. A person has ratified another party's action.
• D. A person has transferred his obligations under a contract to another party.

Answer: A

NEW QUESTION # 85
When a defendant deliberately destroys possessions belonging to someone else, he has committed the tort(s) of

• A. trespass to goods, conversion and nuisance only,
• B. trespass to goods, conversion, nuisance and battery.
• C. trespass to goods only.
• D. trespass to goods and conversion only.

Answer: C

NEW QUESTION # 86
Which of the following is a key principle of insurance that ensures that a policyholder is not overcompensated for a loss?

• A. Utmost good faith
• B. Indemnity
• C. Subrogation
• D. Insurable interest

Answer: B

Explanation:
The principle of indemnity ensures that the policyholder is compensated only to the extent of the loss suffered and does not profit from an insurance claim. This principle is essential to prevent overcompensation.

NEW QUESTION # 87
......

M05 dumps - TestSimulate - 100% Passing Guarantee: https://www.testsimulate.com/M05-study-materials.html