Exam 16: Insurance and Guarantee

Milton,who is 19 years old,purchased a car but found that he was in a position of having to pay extremely high insurance rates.As a way of avoiding those high payments,he had a bill of sale made out to his father and had the car registered in his father's name.His father took out an owner's policy from All Risk Insurance Limited.As was later revealed,Milton's father never paid for the vehicle and Milton remained the true owner and operator.Then,later,when Milton was involved in an accident,the claim was submitted by the father (since the policy was in his name).Upon discovering the true state of affairs,the insurance company refused to pay for damage caused by the accident.What legal basis would the insurance company have to refuse to pay the claim?

Subrogation in insurance law is the

Co-insurance is a technique used by insurance companies to

Subrogation allows an insurance company to recover its loss from the person(s)responsible without having to pay the insurance proceeds to the insured.

Key Bank would not give Tony a business loan without a suitable guarantor.So Tony's father signed as a guarantor.He must make the loan payments when

The concept of subrogation applies to the liability of a guarantor under a loan guarantee.Under the concept of subrogation

John and Henry go to the bank so that Henry can borrow $50 000.00.The bank will only give Henry the money if John guarantees it,and John agrees in writing to do this.A couple of months later and unknown to John,Henry and the bank agree to material changes to Henry's loan,including increasing the interest rate substantially.If Henry defaults on the loan and the bank decides to sue both Henry and John

In June,Ken developed glaucoma,a condition of the eyes that if untreated results in blindness.By August,Ken was legally blind,yet he continued to drive.He informed neither the Ministry of Transportation nor his insurance company of the changed condition of his eyes.On September 12,he got into a serious automobile accident where he was driving and was at fault.Will the insurance company need to pay this claim?