Insurance law. M05

Question 4 Learning Outcome 5 (30 marks) You are a claims handler for an insurer specialising in household insurance. One of the policyholders has home insurance, which includes buildings and contents cover. When the insurance policy was incepted the policyholder conrmed the property was their permanent residence. The policyholder notifies you of a claim for water damage to the property and personal possessions. Whilst investigating the claim, you discover the following: - The policyholder rents out the property on shortterm lets, during which they temporarily vacate the property. However, the policyholder has never informed the insurer of this. - The personal possessions are owned by a guest who had rented the property for the weekend. - The policyholder has received a criminal conviction for burglary, although this conviction occurred after the inception of the policy. (a) Discuss the possible effects of the short-term lets on the policyholder's claim for the property damage. Refer to one statute in support of your discussion. (14) (b) Explain, with justication, whetherthe claim for the personal possessions will be settled. (6) (0) Discuss the effect on both the policy and the claim of the policyholder failing to inform the insurer ofthe criminal conviction