Chapter 11 part 2

Question 1

It also sets out factors a court should take into account when determining whether a term is fair, notably that it should consider the specific circumstances existing when the term was agreed, other terms in the contract and the nature of the subject matter of the contract.

What is this assessment known as?

Answer 1

‘fairness test’.

Question 2

Explain the term is transparent?

Answer 2

A term is transparent if it is expressed in plain and intelligible language and (in the case of a written term) is legible.

Question 3

Explain the term prominent?

Answer 3

A term is prominent if it is brought to the consumer’s attention in such a way that an average consumer would be aware of the term. The Act defines an ‘average consumer’ as a consumer who is reasonably well-informed, observant and circumspect.

Question 4

What is the grey list?

Answer 4

terms that may be regarded as unfair (the so-called ‘grey list’).

Question 5

What is a data controller?

Answer 5

The party who keeps personal data on their customers and determines how and why it is processed?

Question 6

What is a data processor?

Answer 6

An organisation who processes data on a data controllers behalf

Question 7

Identify eight principles of the EU General Data Protection Regulation.

Answer 7

Data must be:

Fairly and lawfully processed
Processed for limited purposes
Adequate, relevant and not excessive
Accurate
Not kept longer than necessary
Processed in accordance with individual’s rights
Secure
Not transferred to countries without adequate protection

Question 8

Identify seven requirements regarding a data subject giving consent for their data to be processed under the GDPR.

Answer 8

Consent must be:

Freely given
Specific
Informed
Unambiguous
Positive opt in
Easy to withdraw
Separate from other terms and conditions

Question 9

Identify eight rights of a data subject under the GDPR

Answer 9

The right to be informed.
The right of access.
The right to rectification.
The right to erasure.
The right to restrict processing.
The right to data portability.
The right to object.
Rights in relation to automated decision making and profiling

Question 10

What Act implements the GDPR into English law?

Answer 10

Data Protection Act 2018

Question 11

What are the five overlapping requirements of ethical behaviour?

Answer 11

Integrity
Fairness
Service
Client’s interest
Compliance

Question 12

What are Ethical Standards?

Answer 12

concerned with the way in which a moral outcome can be achieved in given circumstances They are concerned with behaviour and conduct. In the context of a
profession, the hallmark of a professional is the ability to step back from issues of selfinterest and provide competent independent advice in the best interests of a client.

Question 13

Trade bodies may have their own codes to which members subscribe on a voluntary basis. What would a breach cause?

Answer 13

A breach of the provisions of such a code would not necessarily result in disciplinary action, although there would be regard to the contents of a code in any disciplinary proceedings.

Question 14

Do professional body’s take disciplinary action against members who are in breach of their codes of conduct?

Answer 14

Yes as such codes are designed to provide a framework of appropriate behavior. It follows that failure to follow the code may bring the individual or the profession into disrepute.

Question 15

What is The Chartered Insurance Institute (CII)’s Code of Ethics?

Answer 15

a set of ethical principles for insurance and financial services professionals worldwide.

Question 16

What is the purpose of a The CII Code of Ethics?

Answer 16

virtuous platform for improving the reputation of CII members as a whole and in distinguishing our membership in comparison with less qualified and regulated competitors.

Question 17

What 5 areas doe the code of ethics include?

Answer 17

Integrity
Fairness
Service
Clients Interest
Compliance

Question 18

What are the code of ethics minimum requirements?

Answer 18

Rather than setting a series of minimum requirements, the Code represents a positive statement of the core principles that must inform decision-making, business relationships and a member’s more general behaviour

Question 19

How does the CII assist members in the way that the principles should be applied?

Answer 19

Providing ‘key questions to ask yourself’

Question 20

the CII has also produced two companions to the Code - what do they cover?

Answer 20

digital ethics and financially inclusive customer outcomes

Question 21

Can the CII take disciplinary action against members who do not comply with the code?

Answer 21

yes

Question 22

What are the 5 central principles in the Code of Ethics?

Answer 22

• comply with the code and all relevant laws and regulations;
• act with the highest ethical standards and integrity;
• act in the best interests of each client;
• provide a high standard of service; and
• treat people fairly, regardless of: age, disability, gender reassignment, pregnancy and
maternity, marriage and civil partnership, race, religion and belief, sex, and sexual
orientation

Question 23

What should you do if the Code of Ethics is breached?

Answer 23

Report it to the CII

Question 24

You are aware that a particular client will be on holiday for a significant part of the period immediately prior to renewal and that there is likely to be a need to consider other insurers’ terms because of the poor claims experience during the current policy period.

The company procedure is to contact renewal client 1 month prior to the renewal - what should you do in this instance?

Answer 24

We are concerned here with the difference between the ‘spirit’ and the ‘letter’. You would arguably be acting compliantly if you were to commence the renewal process one month before renewal. However, to act ethically, you would need to start the process earlier to be able to give your client advice in good time to make an informed decision.

Question 25

The FCA states that there are three key areas of training and competence that all
firms need to consider. These are what?

Answer 25

• assessing competence;
• maintaining competence; and
• record-keeping.

Question 26

How many CPD hours does the The Insurance Distribution Directive (IDD) require anyone e involved in the distribution of insurance to complete annually?

Answer 26

15 hours

Question 27

What does DISP stand for?

Answer 27

Dispute Resolution: Complaints (DISP) sourcebook

Question 28

What are the benefits of thorough complaints procedures?

Answer 28

• limit the impact of customer dissatisfaction;
• avoid exposure to errors and omissions claims;
• enable an insurer to identify problems with its systems and rectify them; and
• enable an insurer to improve its standards.

Question 29

FCA regulation is concerned with two categories of complainant - what are they?

Answer 29

‘eligible’ and ‘non-eligible’ (defined later)

Question 30

An ‘eligible complainant’ is defined as a:

Answer 30

• consumer;
• micro-enterprise;
• charity with an annual income of less than £6.5m;
• trustee of a trust with a net asset value of less than £5m;
• consumer buy-to-let (CBTL) consumer;
• small business at the time the complainant refers the complaint to the respondent; or
• guarantor.

Question 31

All complaints from eligible complainants are subject to what?

Answer 31

FCA complaints handling rules and complainants within these categories have a right of access to the Financial Ombudsman
Service (FOS).

Question 32

For non-eligible complainants, what must firms have in place?

Answer 32

appropriate procedures for registering and responding to the expression of dissatisfaction.

Question 33

How many years must complaint files be kept

Answer 33

at least three years from the date the complaint was received, and a record must be kept of measures taken for its resolution.

Question 34

What must a firm provide within 8 weeks of recieveing a complaint?

Answer 34

Either a final response
or
a werotem res[pmse

Question 35

If a final reponse is given and the complaint has been rejected, a firm must inform the complainant that if they remains dissatisfied with the respondent’s response, they may now refer their complaint to the FOS within what time period?

Answer 35

6 months

Question 36

What additional complains handling code does Lloyds have?

Answer 36

Personal Lines Claims and Complaints Handling Code

Question 37

If a policy is placed through Lloyds and the complainant is dissatisfied with the response, what is there next step?

Answer 37

Lloyds can handle the response before going to the FOS if still dissatisfied.

Question 38

Does the FOS deal with disputes from eligible or noneligible complaints?

Answer 38

Eligible

Question 39

The maximum award the FOS can require a firm to make to a complainant changed on 1
April 2019. It is now what?

Answer 39

• £355,000 for complaints about actions or omissions by firms that occurred on or after 1 April 2020.
• £350,000 for complaints about actions or omissions by firms on or after 1 April 2019, and which were referred to the FOS between 1 April 2019 and 31 March 2020.
• £160,000 for complaints about acts or omissions by firms before 1 April 2019, but which were referred to the FOS after that date.

The FOS may recommend a higher figure, if appropriate, but this will not be binding onthe firm.

Question 40

What is the complainants next step if they are still dissatisfied and the FOS has rejected the claim?

Answer 40

Take it to court

Question 41

How is the FSCS funded?

Answer 41

by a levy on all authorised firms who receive an income from eligible
claimants.

Question 42

What is the FSCS primary function?

Answer 42

Compensation clients whos insurer for example has gone into liquidation and they need to claim.

Question 43

What do The Data Protection Act 2018 (DPA 2018) and General Data Protection Regulation (GDPR) set out?

Answer 43

data protection law in the UK