LML4805 PORTFOLIO MEMO - MAY/JUNE 2025 - SEMESTER 1 - UNISA - DUE DATE :- 22 MAY 2025 - (DETAILED ANSWERS WITH FOOTNOTES AND BIBLIOGRAPHY - DISTINCTION GUARANTEED!)

LML4805 PORTFOLIO MEMO - MAY/JUNE 2025 - SEMESTER 1 - UNISA - DUE DATE :- 22 MAY 2025 - (DETAILED ANSWERS WITH FOOTNOTES AND BIBLIOGRAPHY - DISTINCTION GUARANTEED!) Question 1 1(a) Prior to formal insurance relationships, explain how persons attempted to protect their interests by ‘insurance’ in an economic way and why these methods did not offer adequate protection. (6) 1(b) ‘Insurance contracts may be classified according to various criteria and these classifications are not always mutually exclusive.’ Explain this statement with reference to the classification between first-party and third-party insurance, and the classification between property and liability insurance. Also provide relevant examples to support your explanation. (6) 1(c) The requirements for the validity of insurance contracts are the same as those for any other type of contract. Outline the validity requirements that should be met when an insurance contract is concluded or renewed and apply each validity requirement to the insurance law context. (10) 1(d) In view of recent legislative reforms, explain the relevance and application of the terms ‘life insurance’, ‘long-term insurance’ and ‘non-indemnity insurance’. (3) [25] Question 2 2(a) Draft an opinion in your own words to convey arguments against the use of insurable interest in our law. (5) 2(b) Despite arguments against the interest theory, it has generally been applied in South African law. Give a summary of instances where insurable interest may exist in indemnity insurance. (5) 2(c) Explain why insurance contracts may be confused easily with suretyship contracts. Also comment on how these contracts may be distinguished. (5) 2(d) Amos has comprehensively insured his house and the household contents. When the fire alarm alerts him to a fire, Amos rushes home and attempts to extinguish the fire using a garden hose. In trying to limit the fire damage, Amos causes additional water damage to the household contents. He approaches you for a legal opinion on whether his loss will be covered by the insurer. (5) 2(e) Bonny insured her motor-vehicle with EXCELL Insurance. The vehicle is damaged in an accident for which another vehicle is fully liable. Bonny has claimed against EXCELL Insurance and received a full indemnity from the insurer. Discuss how EXCELL Insurance may recover the amount paid. (5) [25] Question 3 3(a) Refer to the definition of an insurance contract in Lake & Others v Reinsurance Corporation & Others 1967 (3) SA 124. Extract possible essentials of the insurance contract in your own words and give a reasoned opinion whether the court’s definition is acceptable. (5) 3(b) Answer the following questions regarding Jerrier v Outsurance Company Ltd 2015 (5) SA 433 KZP: (i) Give a brief summary of the facts, legal question and decision. (4) (ii) Paragraph 4 of Jerrier v Outsurance refers to ‘plain language’. Explain the relevance of this in view of recent legislative instruments and reforms. (4) (iii) Explain the view of the appeal court in Jerrier v Outsurance as to the duty of good faith. (4) 3(c) ‘Insurers are in the business of discrimination’. Comment on this statement with reference to the Constitution of the Republic of South Africa, 1996, and the Promotion of Equality and Prevention of Unfair Discrimination Act 4 of 2000. In particular, discuss unfair practices in insurance services that have been identified and addressed. (8) [25] TOTAL [75]