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Published Date

September 2010

Property Insurance Law and Claims

£125.00
(Excludes any applicable taxes)

This new edition of the previously entitled Fire Insurance Law and Claims, previously written by EJD Peverett FCII and subsequently updated by RM Walmsley has been updated and enhanced by CILA to include the many variations to the law and the introduction of regulations.

PUBLISHED DATE: SEPTEMBER 2010
No. OF PAGES:
399

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This book will be of benefit to all parties involved in the handling of claims. It examines the contract of insurance, insurable interest and indemnity, perils, proximate cause, utmost good faith, fraud, measures of settlement, double insurance and contribution, subrogation and distribution of recoveries, the Financial Ombudsman Service and the Financial Services Authority. It also provides practical hints and tips together with a checklist for handling insurance claims.

The importance of the legal aspects of the loss adjuster’s role cannot be understated and therefore the addition of co-writers from Beachcroft Solicitors makes this book the essential guide to the profession of loss adjusting.

 

CHAPTER 1 - PRINCIPLES OF LAW

1.1 Sources of Law

1.1.1 Legislation

1.1.2 Common Law

1.2 Principles of General Contract Law

1.2.1 The Essential Requirements of a Binding Contract

1.2.2 Privity of Contract

1.2.3 Terms of the Contract

1.2.4 Interpretation of Ambiguous Terms

1.2.5 Exclusion Clauses and Unfair Terms

1.2.6 Misrepresentation and Non-Disclosure

 

CHAPTER 2 - THE PARTIES

2.1 The Policyholder

2.2 Insurance Companies

2.2.1 Underwriters

2.2.2 Claims Department

2.3 Lloyd's of London

2.4 Co-Insurers

2.5 Reinsurers

2.6 Insurance Brokers / Intermediaries

2.7 Underwriting Agencies

2.8 The Financial Services Authority (FSA)

2.9 Financial Ombudsman Service (FOS)

2.10 Loss Adjusters

2.11 Loss Assessors

2.12 Lawyers

2.13 Supply Chain

 

CHAPTER THREE - THE CONTRACT OF INSURANCE

3.1 The Prospectus

3.2 The Proposal Form

3.3 The Schedule of Insurance

3.4 The Policy of Insurance

3.4.1 Preamble

3.4.2 The Insuring Clause

3.4.3 Definitions

3.4.4 Perils and Exclusions

3.4.5 Warranties

3.4.6 Conditions

3.4.7 Endorsements

3.4.8 Survey Requirements / Risk Requirements

3.4.9 Other Terms Of the Contract

3.5 Practical Tips on Dealing with Exclusions and Breaches of Warranty and Condition

3.6 Customer Care and Complaints

 

CHAPTER FOUR - INSURABLE INTEREST AND INDEMNITY

4.1 The Creation of Insurable Interst as a Statutory Requirement

4.2 The Indemnity Principle

4.3 Legislative History

4.4 Situations Where the Interests of More than One Party are Affected

4.4.1 Joint and Composite Insurance

4.4.2 Bailor / Bailee

4.4.3 Landlord / Tenant

4.4.4 Mortgagor / Mortgagee

4.4.5 Vendor / Purchaser of Land

4.4.6 Buiding Contracts

4.4.7 Rental / Hire Agreements

4.4.8 Hotel Proprietors / Guests

4.4.9 Purchaser / Vendor of Goods

4.5 Indemnity

4.5.1 Loss

4.5.2 Measure of Indemnity

4.5.3 Valued Policies

4.5.4 Unvalued Policies

4.5.5 Unvalued or Valued Policy?

4.5.6 Amount Recoverable - Valued Policy

4.5.7 Amount Recoverable - Unvalued Policy

 

CHAPTER FIVE - PERILS

5.1 Fire

5.2 Lightning

5.3 Explosion

5.4 Riot

5.5 Malicious Damage

5.6 Escape of Water

5.7 Escape of Fuel Oil

5.8 Storm

5.9 Flood

5.10 Accidental Damage to Underground Services

5.11 Theft

5.12 Accidental Damage

5.13 Subsidence, Heave and Landslip

 

CHAPTER SIX - PROXIMATE CAUSE

6.1 Statute Law

6.2 Operation of the Doctrine

6.3 Ascertaining the Proximate Cause

6.4 Immediate and Intervening Causes

6.5 Concurrent Causes

6.6 Financial Ombudsman Service

6.7 Summary

 

CHAPTER SEVEN - UTMOST GOOD FAITH

7.1 The Origins of Utmost Good Faith

7.2 Non-Disclosure and Misrepresentation

7.2.1 Non - Disclosure

7.2.2 Misrepresentation

7.3 Material Facts

7.3.1 Facts Material to the Physical Hazard

7.3.2 Facts Material to the Moral Hazard

7.4 Facts that do not Need to be Disclosed

7.4.1 Express Waiver of Right to Disclosure

7.4.2 Implied Waiver of Right to Disclosure

7.5 Inducement

7.6 Avoidance of the Policy

7.7 Waiver and Estoppel

7.8 Continuation of the Duty of Disclosure after the Polcy Incepts

7.9 Approach of the FSa and FOS to Utmost Good Faith

7.9.1 The Financial Services Authority

7.9.2 The Financial Ombudsman Service

 

CHAPTER EIGHT - FRAUD

8.1 What is Fraud

8.2 Burden of Proof

8.3 Categories of Fraudulent Claim

8.4 The Effect of Fraud

8.5 Joint and Composite Policies

8.6 The FOS

8.7 Fraud Indicators and their Investigation

 

CHAPTER NINE - MEASURES OF SETTLEMENT

9.1 Policy Limits and Excesses

9.2 Basis of Settlement Provisions

9.3 The Cost of Establishing the Extent of Loss

9.4 Buildings - Measure of Settlement

9.5 Provisional Sums and Prime Cost items

9.6 Public Authorities Clause

9.7 Debris Removal

9.8 Insurers' Right to Reinstate

9.9 Building Repair Networks

9.10 Non - Buildings - Measure of Settlement

9.11 Extended Warranties

9.12 Salvage

9.13 Costs of Mitigation

9.14 Underinsurance

9.15 Day One Basis

9.16 Index Linking

9.17 Penalties for Underinsurance

9.18 Practical Guidance for Calculating the value at risk

 

CHAPTER TEN - DOUBLE INSURANCE AND CONTRIBUTION

10.1 Double Insurance

10.2 Where Double Insurance can Arise

10.2.1 Same Subject Matter

10.2.2 Same Insured in Respect of the Same Interest

10.2.3 Same Risk / Peril

10.3 Restrictions / Limitations on Double Insurance

10.4 Contribution

10.4.1 Where the Right to Contribution Arises

10.4.2 Payment as a Volunteer

10.5 Determining the Amount of Contribution

10.5.1 Maximum Liability Basis

10.5.2 Independent Liability Basis

10.6 Authority for Method

10.6.1 Average in cases of Concurrent Double Insurance

10.6.2 Average in Cases of Non - concurrent Double Insurance

10.7 ABI Rules on Contribution

 

CHAPTER ELEVEN - SUBROGATION AND DISTRIBUTION OF RECOVERIES

11.1 Subrogation

11.1.1 The Policyholder cannot Profit from their Insurance Claim

11.1.2 Right to Take Action Policyholder's Name

11.1.3 Insurers' Position against the Third Party

11.1.4 Loss Adjusters' Role in Subrogation

11.2 Distribution of recoveries

 

CHAPTER TWELVE - FINANCIAL OMBUDSMAN SERVICE

12.1 Authority of the Financial Ombudsman Service

12.2 Who is Entitled to Make a Complaint to the FOS

12.3 Complaint Handling Rules

12.4 Time Limits

12.5 Adjudication

12.6 The Loss Adjuster's Role in FOS Investigations

12.7 Decisions Made by the FOS

12.8 Awards

12.9 Compliance with Awards and Settlements

12.10 General Services Provideed by the FOS

 

CHAPTER THIRTEEN - THE FINANCIAL SERVICES AUTHORITY

13.1 Role of the FSA

13.2 Regulation of Insurers

13.3 Regulation of Loss Assessors

13.4 Consumer Rights

13.5 Insurance: Conduct of Business Sourcebook

 

CHAPTER FOURTEEN - REFORM OF INSURANCE LAW

14.1 Background

14.2 Consumer Insurance ( Disclosure and Representations ) Bill 2009

14.3 Implementation and Future Reform

 

CHAPTER FIFTEEN - HEALTH AND SAFETY AND CONSTRUCTION ( DESIGN AND MANAGEMENT ) REGULATIONS 2007

15.1 Health and Safety at Work etc Act 1974

15.2 Management of Health and Safety at Work Regulations 1999

15.3 Risk Assessment

15.3.1 Types of Hazards

15.4 Construction Projects Subject to the Regulations

15.5 When Duties Arise and Upon Whom

15.6 Duties on a Client

15.7 Duties on a Designer

15.8 Contractor Competency

15.9 Health and Safety Executive ( HSE )

 

CHAPTER SIXTEEN - PRACTICAL HINTS AND TIPS

16.1 Reporting to Insurers

16.2 Waiver, Estoppel and Reservation of Rights

16.3 Repudiations

16.4 Mitigation of Loss

16.5 Dealing with Policyholders' Claims

16.6 Who should the Settlement Monies be paid to ?

16.7 Forms of Discharge / Settlement Agreements

16.8 Investigations

16.9 Witness Statements

16.10 Status of Correspondence - Privilege, Without Prejudice and Confidential Communications

16.10.1 Privileged Communications

16.10.2 Status of Loss Adjusters' Reports

16.10.3 Without Predjudice Communications

16.10.4 Confidential Communications

 

CHAPTER SEVENTEEN - CHECKLIST FOR HANDLING INSURANCE CLAIMS

 

APPENDICES

 

Appendix 1 The Chartered Institute of Loss Adjusters Charter

Appendix 2 Supplier Network Guidance Note

Appendix 3 Section 1 - ABI Blue Book - Suggested Practice for the Conduct of Material Damage and Business Interruption Insurance in Great Britain and Northern Ireland

Appendix 4 Section 2 - ABI Blue Book - Material Damage and Business Interruption Insurance, Suggested Wordings

Appendix 5 Section 3 - ABI Blue Book - Best Practice Guide to Procedures for Collective Policies

Appendix 6 Section 4 - ABI Blue Book - Claims Management

Apeendix 7 Section 5 - ABI Blue Book - The Role of the Insurance Industry in Dealing with Civil Emergencies

Appendix 8 Section 7 - ABI Blue Book - Recommended Practice for the Disclosure of Claims History

 

READING LIST

 

LIST OF CASES

 

Aegis Electrical and Gas International Services Co Ltd v Continental Casualty Co [2007] EWHC 1762 (Comm)

Agapitos v Agnew (2003) [2002] EWHC 1558 (Comm)

Amey Properties Ltd v Cornhill Insurance plc (1996) [1996] LRLR 259

Anderson v Norwich Union Fire Insurance Society (1977) [1977] 1 Lloyd's Rep 253

Ansari v New India Assurance Ltd (2009) [2009] EWCA Civ 93

Aspen Insurance UK Ltd and Others v Pectel Ltd (2008) [2008] EWHC 2804 (Comm)

Austin v Drew (1815) 171 ER 115

AXA v Gottlieb (2005) [2005] EWCA Civ 112

Baghbadrani v Commercial Union Assurance Co plc (2000) [2000] Lloyd's Rep IR 94

Bank of Nova Scotia v Hellenic Mutual War Risk Association (Bermuda) Ltd ( the 'Good Luck' ) (1992 [1991] 2 WLR 1279

Bankers Insurance Co Ltd v South (2004) [2003] EWHC 380 (QB)

Bedfordshire Police Authority v Constable (2009) [2009] EWCA Civ 64

Boag v Economic Insurance Co Ltd (1954) [1954] 2 Lloyd's Re3p 581

Carter v Boehm (1766) 97 ER 1162

Castellain v Preston (1883) [1882 - 83 ] LR 11 QBD 380

Commercial Union Assurance Co v Hayden (1977) [1977] QB 804

Commonwealth Smelting Ltd v Guardian Royal Exchange Assurance (1984) [1984] 2 Lloyd's Rep 608

Co-operative Retail Services Ltd v Taylor Young Patnership and Others (2002) [2002] UKHL 17

Coven SpA V Hong Kong Chinese Insurance Co Ltd (1999) [1999] CLC 223

Darrell v Tibbitts (1880) [1879-80] LR 5 QBD 560

Derry v Peek (1889) [1889] LR 14 App Cas 337

Direct Line Insurance plc v Fox (2009) [2009] EWHC 386 (QB)

Doheny v New India Assurance Co Ltd (2005) [2004] EWCA Civ 1705

Drake v Harbour (2008) [2008] EWCA Civ 25

Drake Insurance plc v Provident Insurance plc (2004) [2003] EWCA Civ 1834

Eagle Star Insurance Co Ltd v Games Video Co (GVC) SA ( the 'Game Boy') (2004) [2004] EWHC 15 (Comm)

Elcock v Thompson (1949) [1949] 2 KB 755

Fenwick v Schmalz (1868) [1868] LR 3 CP 313

Fleming v Hislop (1886) LR 11 App Cas 686

Fosse Motor Engineers v Conde Nast Magazine Distributors (2008) [2008] EWHC 2037 (TCC)

Harris v Poland (1941) [1941] 1 KB 462

Glasgow Training Group (Motor Trade) Ltd v Lombard Continental plc (1989) (cited as 4 November 1988) [1989] SC 30

Global Process Systems Inc and Another v Syarikat Takaful Malaysia Berhad (The 'Cendor Mopu') (2009) [2009] EWCA Civ 1398

Hamilton Fraser & Co v Pandorf (1887) ([887] LR 12 App Cas 518

Hepburn v A Tomlinson (Hauliers) Ltd (1966) [1966] AC 451

HIH Casualty and General Insurance Ltd v New Hampshire Insurance Co (2001) [2001] EWCA Civ 735

Hornal v Neuberger Products Ltd (1957) [1956] 3 WLR 1034

Insurance Corporation of the Channel Islands v Royal Hotel (1998) [1998] Lloyd's Rep IR 151

Investors Compensation Scheme Ltd v West Bromwich Buiding Society (1998 ) [1998] 1 WLR 896

iONIDES V pENDER (1874) [1873-74] LR 9 QB 531

James v CGU Insurance plc (2002) [2002] Lloyds Rep IR 206

Kausar v Eagle Star Insurance Co Ltd (2000) [1997] CLC129

Knight of St Michael [1898] p 30

Kosmar Villa Holidays plc v The Trustees of Syndicate 1243 (2007 & 2008) [2007] EWCA Civ 1003; and [2007] EWHC 458 (Comm)

Kyzuna Investments Ltd v Ocean Marine Mutual Insurance Association (Europe) Ltd (The 'Solveig') (2000) [2000] 1 All ER (Comm) 557

Laker Vent Engineering Ltd v Templeton Insurance Ltd (2009) [2009] EWCA 62

Legal and General Assurance Society Ltd v Drake Insurance Co Ltd 1992 [1991] 2 Lloyd's Rep 36

Leppard v Excess Insurance (1979) [1979] 1 WLR 512

Lewis v Norwich Union Healthcare Ltd (2009) [2010] Lloyd's Rep IR 198

Lonsdale & Thompson Ltd v Black Arrow Group plc(1993) [1993] ch

361

Mark Rowlands Ltd v Berni Inns Ltd (1986) [1985] 3 WLR 964

Martini Investments v McGinn (2001) [2000] 2 Lloyd's Rep 313

Matalan Discount (Cash & Cash) Ltd v Tokenspire Prperties (North Western) Ltd (2001) QBD (Technology & Construction Court). 18 May 2001 unreported

Midland Mainline Ltd v Eagle Star Co Ltd (2004) [2004} EWCA Civ 1042

Moore v Evans (1918) [1918] AC 185

Napier and Ettrick v R F Kershaw Ltd and Others (1), Napier and Ettrick v Hunter (1993) [1993] AC 713

National Employers Mutual General Insurance Association Ltd v Haydon (1980) [1980] 2 Lloyd's Rep 149

National Farmers Union Mutual Insurance Society Ltd v HSBC Insurance (UK) Ltd (2010) [2010] EWHC 773 (Comm)

Nobel's Explosives Co Ltd v British Dominions General Insurance Co (No1) (1918) [1918] SC 373

North British and Mercantile Insurance Co v London Liverpool and Globe Insurance Co (1877) [1877] LR 5 Ch D 569

North Star Shipping Ltd v Sphere Drake Insurance plc (2006) [2006] EWCA Civ 378

Nsubuga v Commercial Union (1998) [1998] 2 Lloyd's Rep 682

Oddy v Phoenix Assurance (1966) [1966] 1 Lloyd's Rep 134 Orakpo v Barclays Insurance Services Ltd (1995) [1995] LRLR 443

Pan Atlantic Insurance Co Ltd v Pine Top Insurance Co Ltd (1994) [1994] 3 WLR 677

Pawsey v Scottish Union and National (1908) [1908] Times, 17 October 1908

Quorum AS v Schramm (2002) [2002] 2All ER (Comm) 147

Ramco (UK) Ltd v International Insurance Co of Hanover (2004) [2004] EWCA Civ 675

R v Ghosh ((19820 [1982] QB 1053

Re Highgrade Traders Ltd (1984) [1984] BCLC 151

Reynolds v Phoenix Assurance Co Ltd (1978) [1978] 2 Lloyd's Rep 440

Rhesa Shipping Co SA v Edmunds (The 'Popi M') (1985) [1985] 1 WLR 948

Roberts v Avon Insurance (1956) [1956] 2 Lloyd's Rep 240 Rohan Investments Ltd v Cunningham (1998) [1999] Lloyd's Rep IR 190

S&M Hotels v Legal and General Assurance Society (1972) { 1972] 1 Lloyd's Rep 157

Scott v The Copenhagen Reinsurance Co Ltd (2003) [2003] EWCA Civ 688

Scottish and Newcastle plc v G D Construction (St Albans) Ltd (2003) [2003] EWCA Civ 16

Shanklin Pier Ltd v Detel Products Ltd (1951) [1951] 2 KB 854

Shinedean Ltd v Alldown Demolition (London) Ltd (2006) [2006] EWCA Civ 939

Sirius International Insurance v Friends Provident Life & Pensions Ltd

(2005) [2005] EWCA Civ 601

Siu Yin Kwan and Another v Eastern Insurance Co Ltd (1994) [1994] 2 AC 199

Sofi v Prudential Assurance Co Ltd (1993) [1993] 2 Lloyd's Rep 559

Stockton v Mason (1978) [1978] 2 Lloyd's Rep 430

Stowers v GA Bonus plc (2003) [2003 Lloyd's Rep IR 402

Structural Polymer Systems Ltd v Brown (2000) [1999] CLC 268

Tanner v Bennett(1825) 171 ER 987; [1825] Ry & M 182

Tate Gallery (Trustees) v Duffy Construction Ltd (2007) 1 [2007] EWHC 19 (Comm)

Tempus Shipping Co v Louis Dreyfus & Co (1931) [1931] AC 726

Thor Navigation Inc v Ingosstrakh Insurance Co Ltd (2005) [2005] EWHC 19 (Comm)

Tonkin v UK Insurance (2007) [2006] EWHC 1120 (TCC)

Tootal Broadhurst Lee Co Ltd v London Lancashire Fire Insurance Co (1908) The Times 21 May 1908

Wayne Tank and Pump Co Ltd v Employers' Liability Insurance Corporation Ltd (1973) [1973] 3 WLR 483

Weddell v Road Traffic and General Insurance Co (1932) [1932] 2 kb 563

Winicofsky v Army & Nvy General Insurance Association Ltd (1919) [1919] 88 LKJB1111

WISE (Underwriting Agency) Limited and Others v Grupo Nacional Provincial SA (2004) [2004] EWCA Civ 962

Woolcott v Sun Alliance (1978) [1978] 1 WLR 493

Young v Sun Alliance (1976) [1976] 3 All ER 561

The Chartered Institute of Loss Adjusters (CILA) is a globally recognised membership organisation for claims professionals. The Institute sets the professional and ethical standards for those who work in the handling of claims through its qualification framework and guide to professional conduct.

The CILA Council is the governing body for the Institute. Day to day activities are overseen by an Executive Committee, which is chaired by the CILA’s Executive Director.

Title: Property Insurance Law and Claims
Subtitle: CILA
Number of Volumes: 1
Edition: First
Number of Pages: 399
Product Code: WS1255K
ISBN: ISBN 13: 978-1-85609-406-1 (9781856094061), ISBN 10: 1-85609-406-5 (1856094065)
Published Date: September 2010
Binding Format: Hardback
Book Height: 240 mm
Book Width: 160 mm
Book Spine: 30 mm
Weight: 1.20 kg

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