Cii Questions

Question 1

Why is the law of large number important with insurance

Answer 1

The greater the number of similar risks, the closers the actual outcome will be to the expected losses

Question 2

What is the best description of the principle of pool risk

Answer 2

There losses of the few are met by the contributions of the many

Question 3

Where an insurance policy is arrange on a collective basis the insured needs to be aware that

Answer 3

Each insurer is separately liable to the insured for thier proportion of any claim that become payable

Question 4

Under the insurance distribution divertive an ancillary insurance intermediary

Answer 4

Distribution insurance even though its a principle activity is not insurance Distribution

Question 5

What type of intermediary does not need to be authorised by the fca

Answer 5

An appointed representative

Question 6

An independent insurance broker acts as the agent of the insurance company when

Answer 6

The broken has authority from the insurer to handle proposal forms and confirm cover

Question 7

When arranging insurance what does the insurer need to do to comply with the principle of good faith

Answer 7

It can only introduce non standard terms if they are previously agreed

Question 8

What action is an insurer most likely to take if an application form is completed recklessly and there is a subsequent related claim for a non consumer insurance

Answer 8

Terminate the insurance contract from inception, refuse the claim and retain all the premium paid

Question 9

The principle of indemnity aims to

Answer 9

A maintain the insureds financial position

Question 10

When a claim is made on an insurance policy, the insurer will seek establish all the possible cause of the loss before deciding whether the claim is valid. This is know as the principle of

Answer 10

Proximate cause

Question 11

When do insurers use averaging for a claim

Answer 11

When a risk is under insured

Question 12

Umder common law tort is the duty of everyone to

Answer 12

Act is a reasonable way toward others

Question 13

Employees in great Britain must have Employees liability insurance with an indemnity limit of at least

Answer 13

£5 million

Question 14

When the prudential regulation authority refers to judgement led regulation what is this referring to

Answer 14

Assessing the future risks of a firm

Question 15

The fca strategic or overall objective is to

Answer 15

Make market work well

Question 16

The supervision of small regulated firms by the fca will nor

Answer 16

Involve less direct contact then with a larger firms

Question 17

If alvaro has been criminally prosecuted by the fca this is most likely to be because

Answer 17

He was advising on regulated insurance products without he’s business being authorised

Question 18

For an insurers online marketing to comply with gdpr

Answer 18

People have to positively give their consent to opt in to marketing

Question 19

For its members the cii code of ethics

Answer 19

Goes beyond legal and regulatory rules

Question 20

Who in the first instance should a policyholder complain go if they believe that they were mis sold a regulated product

Answer 20

The authorised firm that provide the advice

Question 21

What us the potential benefit of buying insurance via direct marketing from an insurance company

Answer 21

Premiums may be lower than would others ie be the case

Question 22

Why is an insurance company most likely to use reinsurance

Answer 22

It allows them to manage the risk they are prepared to accept

Question 23

Under fca rules the definition of an eligible complaint includes a

Answer 23

Consumer

Question 24

A pure risk is where there is

Answer 24

A possibility of a loss or break even but not a gain

Question 25

Insurance is based on the principle that the losses of the few are met by the contributions of the many. This depends on two main factors

Answer 25

Large numbers and equitable

Question 26

An insured that buys reinsurance is known as the

Answer 26

Ceding office

Question 27

The fca is able to prosecute an individual for

Answer 27

Misleading the regulator

Question 28

Contribution will only apply if six criteria are met which is not one of these

Answer 28

Common policy conditions

Question 29

The process of assessing risk and attempting to deal with risk it is called 
A risk measurement 
B risk Management 
C risk strategy 
D risk perception

Answer 29

B risk management

Question 30

Why is risk management important
A. it is necessary in order to comply with armic risk management standards
B. It enables companies to protect themselves again the financial consequences of all risk
C.It reduces the potential for loss through identifying and managing hazard
D. It provides a process

Answer 30

C. It reduces the potential for loss through identifying and managing hazard

Question 31

To protect themselves from an accumulated of risk in one area. Insurers can share the risk with 
A. A broker 
B. A reinsurer 
C. An intermediary 
D. An aggregator

Answer 31

B. Re insurer

Question 32

To offer independent advice and engage in regulated activities  an intermediary must have apply for direct authorition from the fca in which case they will then be known as 
A. An introducer representative 
B. An appointed representative 
C. An authorised person 
D. A designated professional

Answer 32

C. An authorised person

Question 33

Which type of intermediary is tied to providing advice on the products provided by one or more particular insurer
A. An appointed representative
B. An independent intermediary
C. An introducer appointed representative
D. A lloyds browkr

Answer 33

A. An appointed representative

Question 34

Re insurers is a method of transferring risk used by a 
A. Insurers 
B. Individual 
C. Corporate 
D. Public bodies

Answer 34

A. Insurers

Question 35

Which of the following act did away with the requirements for a motor policyholder to return their certificate of motor insurance when cancelling their policy mid term 
A. Financial act 2015
B. Deregulation 2015
C. Insurance act 2015 
D. Consumers right 2015

Answer 35

B. Deregulation act 2015

Question 36

When a third party is unaware of the extent of am agent authority the law makes provision for 
A Express authority 
B. Actual authority 
C. Apparent authority 
D. Implied authority

Answer 36

C. Apparent authority

Question 37

The duty to make fair presentation of the risk applies to 
A.  General insurance 
B. All insurance contracts only 
C. Non consumer insurance contracts 
D. Consumer insurance contract

Answer 37

C. Non consumer insurance contract

Question 38

Which type of property cannot be insured on a reinstatement basic 
A. A house 
B. A piece of machinery 
C. Retailers stock in trade 
D. A block of flats

Answer 38

C. Retailers stock in trade

Question 39

How often do authorised companies need to report complaints to the fca 
A. Annually 
B. Monthly 
C. Twice a year 
D. Quarterly

Answer 39

C. Twice a year

Question 40

Which of these is an example of a civil as opposed to a  criminal or regulatory action for misconduct 
A. Withdrawal of approval 
B. Prosecution 
C. An injunction 
Dm cancellation of permissions

Answer 40

C. An injunction