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ISR3701 Assignment 1 Semester 1 2023 R50,75   Add to cart

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ISR3701 Assignment 1 Semester 1 2023

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ISR3701 Assignment 1 Semester % TRUSTED workings with detailed Answers for A+ Grade.

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  • April 6, 2023
  • 19
  • 2022/2023
  • Exam (elaborations)
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  • isr3701
  • 2023
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ISR3701
ASSIGNMENT 1 SEMESTER 1 2023

,Question 1

Mr. A insured his car, valued at R400 000, with Company X for R150 000 and
Company Y for R250 000. Mr. A is involved in an accident and damage to his
car amounts to R25 000.His claim, however, is repudiated due to some
technical reasons. Company Y, however, decided to make an ex gratia
payment of R15 625 to Mr. A.BASED ON THE
AFOREMENTIONEDSCENARIO, INDICATE THE CORRECT STATEMENT. a.
Ex gratia payments are indemnity payments. b. Company X will be liable to pay
R9 375 to Mr. A. c. Ex gratia payments may affect future claims payments. d.
The principle of contribution does not apply to ex gratia payments. Clear my
choice ◄ Additional Resources Jump to... Assessment 2 ► Dashboard /
Courses / UNISA / 2023 / Semester 1 / ISR3701-23-S1 / Welcome Message /
Assessment 1  Dashboard Calendar Time left 0:43:16




The correct statement is c. Ex gratia payments may affect future claims
payments.

Ex gratia payments are payments made voluntarily by an insurance company
out of goodwill, and are not legally required under the terms of the insurance
policy. As such, they do not fall under the principle of indemnity, which requires
insurance companies to compensate policyholders only for the actual amount
of their loss, up to the limit of the policy.

In this case, Company Y's ex gratia payment of R15 625 does not represent
the full amount of Mr. A's loss, but is a partial payment made as a gesture of
goodwill. However, since it is a payment made by an insurance company, it
could potentially affect future claims payments. This is because insurance
companies may take into account any ex gratia payments made to a
policyholder when calculating premiums or assessing claims in the future.

Regarding the other options, a is incorrect as ex gratia payments are not
indemnity payments, b is incorrect as Company X would not be liable to pay
anything since Mr. A's claim was repudiated, and d is incorrect as the principle
of contribution still applies to ex gratia payments.

, Question 2

Not yetanswered Marked out of1.00 Indicate the correct statement (s). a) The breaching
of a warranty in an insurance contract by the insured may result in the repudiation of a
claim by the insurer. b) The first amount payable is reflected in the schedule of a policy
document. c) Insurance contracts are based on the premise of caveat emptor. d) The
reasonable man test is generally applied to test the validity of insurance contacts.
CHOOSE THE CORRECT COMBINATION: a. a) b) c b. a) b) d c. a) b) c) d d. a) d Clear
my choice ◄ Additional Resources Jump to... Assessment 2 ► Dashboard / Courses /
UNISA / 2023 / Semester 1 / ISR3701-23-S1 / Welcome Message / Assessment 1 
Dashboard Calendar Time left 0:42:12



The correct combination is a. a) b) c.

a) The breaching of a warranty in an insurance contract by the insured may result in the
repudiation of a claim by the insurer. This statement is correct because a warranty is a
specific condition that must be met by the insured in order for the insurance contract to
be valid. If the insured breaches a warranty, the insurer may have grounds to repudiate
any claims made under the policy.

b) The first amount payable is reflected in the schedule of a policy document. This
statement is also correct, as the first amount payable (also known as the excess or
deductible) is typically listed in the schedule of a policy document, along with other key
details of the policy.

c) Insurance contracts are based on the premise of caveat emptor. This statement is
incorrect, as insurance contracts are not based on the principle of caveat emptor (let the
buyer beware). Rather, insurance contracts are typically subject to a duty of utmost good
faith, which requires both parties to act honestly and fairly towards each other.

d) The reasonable man test is generally applied to test the validity of insurance contacts.
This statement is incorrect, as the reasonable man test is not typically used to test the
validity of insurance contracts. However, it may be used in certain circumstances to
determine whether an insured's actions were reasonable under the circumstances, which
could impact the validity of a claim.

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