C2 Flashcards

1
Q

What are four different ways of obtaining information?

A
  • proposal forms
    -brokers
    -risk surveys
    -call centres
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2
Q

What is the most common way of obtaining information as an insurer?

A

Proposal Form

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3
Q

What types of questions do proposal forms include?

A

General and Specific

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4
Q

What type of general questions are included in a proposal form?

A
  • Name
  • Correspondence address
  • occupation
    -period of insurance
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5
Q

What type of specific questions are included in a proposal form?

A
  • The risk address
    -age
    description of risk
    -sum insured or limit of liability
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6
Q

A premium is usually decided by applying a premium rate to a premium base. What does the rate and base represent?

A
  • The premium rate reflects the hazard associated
    -The premium base reflects the measure of exposure
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7
Q

What is the equation for premium?

A

Sum Insured X Rate = Premium

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8
Q

Does rate per cent or rate per mile represent the price in pounds for £1000 of exposure?

A

rate per mile

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9
Q

What is the difference between an adjustable premium and a flat premium?

A

An adjustable premium can be adjusted up or down at the end of the year so that is no longer based on an estimate whereas a flat premium is pre set or from a rating table.

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10
Q

What is the Standard rate of Insurance Premium Tax and then what is the higher rate?

A

12% and then 20%

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11
Q

Who is IPT paid by?

A

The policyholder

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12
Q

What are three different ways of paying for premium?

A
  • upfront single payment
  • by credit
    -in monthly direct debit instalments
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13
Q

Why is a fee usually added each month when paying for premium monthly?

A

to reflect the loss of interest from the premium not being paid fully at the start.

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14
Q

How does the Association of British Insurers define Contract Certainty?

A

it is achieved by “the complete and final agreement of all terms,, with contract documentation provided promptly”

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15
Q

What is used as evidence of the contract?

A

the policy itself

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16
Q

What is used as temporary evidence of a contract once the cover has been granted?

A

Cover Note

17
Q

If the insured accepts the quote within the set time period, what does the insurer have to do?

A

The insurer is legally bound to honour the quote