CII M05 : Insurance law (IL) Exam

  • Exam Code: M05
  • Exam Name: Insurance law (IL) Exam
  • Updated: Sep 07, 2026
  • Q & A: 121 Questions and Answers

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CII M05 Exam Syllabus Topics:

SectionObjectives
Topic 1: Insurance Contract Terms and Vitiating Factors- Policy terms and breaches
  • 1. Representations
  • 2. Warranties
  • 3. Conditions
- Factors affecting validity
  • 1. Non-disclosure
  • 2. Misrepresentation
  • 3. Fraud
Topic 2: Law of Contract- Contract formation and operation
  • 1. Offer and acceptance
  • 2. Breach of contract
  • 3. Terms of contract
  • 4. Consideration
Topic 3: Subrogation and Contribution- Recovery rights and sharing of losses
  • 1. Subrogation
  • 2. Contribution
Topic 4: Law of Torts- Principles of tort law
  • 1. Trespass
  • 2. Nuisance
  • 3. Negligence
Topic 5: Law of Agency and Insurance- Agency relationships
  • 1. Creation of agency
  • 2. Duties and liabilities
  • 3. Authority of agents
Topic 6: Formation of Insurance Contracts- Core insurance principles
  • 1. Utmost good faith
  • 2. Disclosure and misrepresentation
  • 3. Insurable interest
Topic 7: Insurance Claims- Claims process and legal principles
  • 1. Claims handling
  • 2. Policyholder duties
  • 3. Claims notification
Topic 8: Nature and Sources of English Law and Legal Persons- Nature and sources of English law
  • 1. Statute law
  • 2. European and international influences
  • 3. Common law
- Legal personality
  • 1. Juristic persons
  • 2. Natural persons
Topic 9: Indemnity and Loss Measurement- Principle of indemnity
  • 1. Methods of indemnification
  • 2. Valuation of loss

CII Insurance law (IL) Sample Questions:

Question 1

Which legislation regulates the conduct of insurance companies and their intermediaries in the UK?

A. The Insurance Act 2015
B. The Consumer Insurance (Disclosure and Representations) Act 2012
C. The Companies Act 2006
D. The Financial Services and Markets Act 2000


Question 2

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

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


Question 3

What type of reduction is sometimes applied to the replacement cost of an item under an insurance policy claim in order to reflect the application of indemnity?

A. Brokerage.
B. An excess.
C. Wear and tear.
D. Loss of interest.


Question 4

The principle of indemnity is the

A. obligation of the insurer to provide a maximum sum insured or limit of liability.
B. placing of the insured, at expiry of a policy, in the same financial position as enjoyed at inception.
C. obligation of the insurer to pay all valid claims according to the terms and conditions of the policy.
D. placing of the insured, after a loss, in the same financial position as enjoyed immediately before the loss.


Question 5

Which of the following is a typical remedy for an insurer when the insured breaches a warranty?

A. The insurer can sue the insured for breach of contract
B. The insurer is obligated to reduce the payout amount based on the breach
C. The insurer must continue to provide coverage, but with an increased premium
D. The insurer may cancel the contract or refuse to pay a claim


Solutions:

Question 1
Answer: D
Question 2
Answer: C
Question 3
Answer: C
Question 4
Answer: D
Question 5
Answer: D

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