CII I10 common mistakes
CII I10 · Understand the traps and how to avoid them.
Answering questions on the basis of how insurance 'should' work in everyday life rather than on what the policy wording and statute actually say, for example assuming a claim must be paid because it feels fair.
Candidates rely on general commercial intuition and media impressions of insurance rather than the precise contractual and statutory language; I10 rewards the legally correct outcome even where it seems harsh to a layperson.
What to do instead
For every scenario question, first identify the governing source: policy term, statute (for example the Insurance Act 2015, Consumer Insurance (Disclosure and Representations) Act 2012, or the Third Parties (Rights against Insurers) Act 2010), or common-law principle. State the rule to yourself before evaluating the facts, and practise explaining why an 'unfair-feeling' outcome is legally correct.
Confusing the different disclosure and representation regimes, applying the consumer duty of 'reasonable care' to a commercial insured or applying the business 'fair presentation' duty to a consumer.
The CIDRA 2012 and Insurance Act 2015 regimes look similar but impose different standards, different remedies (proportionate vs. all-or-nothing avoidance) and different burdens. Candidates learn them together and blur the boundaries under time pressure.
What to do instead
Build a two-column comparison table: consumer vs. commercial. For each, record the duty owed, the test applied, the remedies for qualifying/non-qualifying breach, and the effect of deliberate or reckless behaviour. Drill scenario questions where the only distinguishing fact is the status of the insured.
Treating the duty of utmost good faith and the duty of fair presentation as interchangeable, or stating that breach of good faith automatically allows the insurer to avoid the contract in all circumstances.
Older textbooks and course summaries still describe good faith as a single overriding duty with avoidance as the remedy; the 2015 Act restructured this and limited avoidance to deliberate or reckless breaches.
What to do instead
Learn the current position explicitly: the 2015 Act abolished the old duty as a standalone remedy, retained good faith as an interpretative principle, and made the fair presentation duty the operative disclosure obligation. Note the remedies available for each type of breach and practise writing them from memory.
Misapplying the rules on insurable interest, for example assuming a life policy requires the proposer to have an interest at the time of the insured's death rather than at inception, or assuming indemnity policies require interest at both inception and loss.
The timing rules differ between life and indemnity insurance and between the relevant statutes (Life Assurance Act 1774, Marine Insurance Act 1906 as amended). Candidates memorise that interest is 'required' without anchoring when.
What to do instead
Create a timing matrix: life (interest at inception), indemnity generally (interest at inception and at loss), marine (rules under the 1906 Act). Test yourself with short scenarios where the interest arises or disappears between inception and loss, and state the timing rule before answering.
Confusing the roles and liabilities of the parties in the chain of insurance intermediation, for example treating an agent acting for the insurer as if it were the insured's agent, or failing to distinguish an insurance broker from an appointed representative.
Agency status determines whose knowledge is imputed, who owes duties, and who can be liable for negligent advice. Candidates often answer from the label used in the scenario rather than from the underlying authority relationship.
What to do instead
For each intermediary question, ask: on whose behalf does this person act, who pays them, and who gave them authority? Learn the classic distinctions (agent of the insurer vs. agent of the insured, broker vs. tied agent) and the consequences for imputed knowledge and for liability in negligence.
Describing the effect of a breach of a policy condition as if it always discharges the insurer, without distinguishing conditions precedent to liability, warranties, and mere conditions.
The terminology overlaps and the Insurance Act 2015 changed the consequences of breach of warranty (suspensive rather than automatic discharge). Candidates conflate all three and give a blanket answer.
What to do instead
Classify each term you meet: is it a warranty, a condition precedent to liability, or an ordinary condition? Then state the consequence of breach for each class, including the 2015 Act's suspension rule for warranties and the need for causal connection for conditions precedent where the Act applies. Practise classifying terms from short extracts.
Ignoring the effect of the Consumer Insurance (Disclosure and Representations) Act 2012 on the insurer's remedies, and instead applying the older all-or-nothing avoidance remedy to consumer non-disclosure.
Pre-2012 learning materials and older case law still appear in study notes; candidates reproduce avoidance as the standard remedy without checking the status of the insured and the nature of the misrepresentation.
What to do instead
Memorise the proportionate remedy scheme: for careless misrepresentation, the insurer may apply a remedy that puts it in the position it would have been in had the misrepresentation not occurred, which may mean reducing the claim rather than avoiding. Work through numerical examples to see how the reduction is calculated.
Failing to distinguish the legal effect of a 'without prejudice' settlement offer, an ex gratia payment, and an admission of liability, and treating each as if it created a binding obligation.
These concepts sound similar and candidates answer from the general meaning of the words rather than from their legal effect on the claim and on the parties' rights.
What to do instead
Learn each concept with a one-line definition and its legal effect: without prejudice (not admissible, protects settlement negotiations), ex gratia (paid without admission of liability, generally not recoverable), admission (may create an estoppel or contractual obligation). Apply each to a short scenario and state the consequence for the insurer and insured.
Under-answering scenario questions by giving only the conclusion, without identifying the legal principle, the facts that trigger it, and the resulting remedy; or conversely writing long general essays that never reach the specific answer required.
I10 questions often require application of law to facts. Candidates either know the law but not how to apply it, or write everything they know in the hope that the examiner will find the answer.
What to do instead
Adopt a fixed answer structure: identify the issue, state the rule and its source, apply it to the facts, then state the conclusion and remedy. Practise with timed scenario questions and check that each answer contains all four elements in the correct order.
Relying on outdated case law or repealed statutory provisions, for example citing pre-2015 authorities on avoidance for breach of warranty or pre-2012 authorities on consumer non-disclosure, without noting the current law.
Study materials and memory anchors are often several years old, and candidates reproduce them without checking whether the position has changed; the syllabus tests current law.
What to do instead
Maintain a dated 'law change' sheet listing the key reforms (CIDRA 2012, Insurance Act 2015, Third Parties (Rights against Insurers) Act 2010, Enterprise Act 2016 late payment provisions) with the old and new positions side by side. Before citing any authority in an answer, confirm which regime applies to the facts given.