Page 57 - Liability Insurance IC74

Guide for Liability Insurance

(d) loss of reduced expectation of life.

Ref Q2 of Nov 2007

Q3. Explain the following in relation to products
liability policy :

Ans: (a) Operative clause -the first part of the clause refers
to the business of the insured, the proposal and
declaration on payment of premium.

The second part of the lawsuit that is special to product
liability policy provides that the company will indemnify
the insured: (i) against a legal liability to pay
compensation(including claimants costs, fees and expenses)
and (ii) in accordance with the law of the country.

The cause provides that the indemnity does not apply :
(i) in respect of any judgement, payments, settlements
made in countries which operate under the laws of US
or Canada. (ii) to any order made anywhere in the world
to enforce such judgement. (iii) unless the insured has
requested that there shall be no such limitation and has
accepted the terms of North American Jurisdiction
Extension Clause which forms part of the policy.

(b) Indemnity clause -this clause provides that indemnity
only applies to:

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