Chapter 1 Flashcards
What Is the definition of sole trader?
An individual who owns and runs their own business and may employ staff
What is the definition of a partnership business?
A business owned and run by two or more people who may employ staff
What is an example of a small business?
Small businesses commonly include offices, shops, hotels, guest houses, surgeries, salons, care homes and tradespeople (such as plumbers and electricians)
 What is the financial policy committee (FPC)
The financial policy committee within the bank of England is responsible for macro-Prudential regulation and watching for emerging risks in the UK’s financial system
What is the Prudential regulation authority (PRA)
The Prudential regulation authority is part of the Bank of England which is responsible for the micro – Prudential regulation of systematically important firms. It will not seek to prevent all firms failures, but will try to ensure that firms can fail without bringing down the entire financial system
What areas does the ICOBS cover?
Application General matters Distance communications Information about the firm, services and renumeration Identifying client needs and advising Product information Cancellation Claims handling
What is a combined policy?
A combined policy was introduced to cater for business risks when more than one type of insurance is required.
A single policy document is issued from one proposal form. Even though one policy document is issued a combined policy is really a collection of individually written covers that are grouped together. Each section is under written and rated separately. Combined policies are suited to medium or large firms.
Professional indemnity insurance covers against a wide range of scenarios. What are the most common scenarios included?
Professional negligence
Loss of documents or data
Unintentional breach of copyright and/or confidentiality
Defamation, slander and libel
What are package to commercial policies?
A package policy is most suitable to small businesses in which the policy wording will be tailored to meet the needs of that particular trade through the inclusion of specific extensions to cover.
They will always include damage to business contents, business interruption and employers public and products liability insurance.
Package policies are not individually underwritten and rated.
Insurers are increasingly introducing non-insurance benefits to their policies what are the three most common?
Risk control advice
Helplines and advice
Authorised repairers and suppliers
What is the FCA definition of a vulnerable customer?
Someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care
What has the IDD set out to achieve
Make it easier for firms to trade across borders
Strengthen policyholder protection
Provide a level playing field
