Health And General Insurance Flashcards
Julie wants to make sure she can meet all of her essential outgoings if she is unable to work due to medium - or long term illness. Which of the following products would be most suitable for her?
A) accident, sickness and unemployment (ASU) insurance
B) critical illness cover
C) income protection insurance
D) private medical insurance
C) income protection insurance
ASU - only covers mortgage payments for up to 2 years.
Critical illness - lump sum and only covers specific conditions.
Private medical only covers costs directly related to medical treatment.
The contents of Charlene’s home are insured for £25,000when they are actually worth £50,000. She is burgled and loses £2000 worth of computer equipment. Using the average principle calculate how much the insurance company will pay her?
£1000
When Gary was diagnosed with bowel cancer atbthe age of 50, he was able to use the lump sum he received from his insurance policy to clear his mortgage. Which of the following types of insurance did Gary have?
A) private medical insurance
B) income protection insurance
C) critical illness insurance
D) long-term care insurance
C) critical illness insurance
Marco, a self employed painter and decorator, is considering taking out income protection insurance. He should opt for as short a deferred period as possible. True of false?
True.
Marco’s income will reduce rapidly so he should opt for a short deferred period rather than a long one.
Marco’s partner Lydia, an HR manager, already has income protection insurance. If she claims under her policy, she will have to pay tax and national insurance on the income she receives. If Marco goes ahead and buys income protection he will not have to pay tax or national insurance if he has to claim benefits under the policy. This is likely because:
A) marco’s earnings are below the personal allowance for income tax
B) marco’s policy will be arranged on an individual basis whereas Lydias policy has been arranged as part of a group scheme
C) marco is self employed where as Lydia is an employee
D) then insurance provider from whom Marco is thinking of buying his policy has rules to Lydias insurance provider.
B) marco’s policy will be arranged on an individual basis whereas Lydias policy has been arranged as part of a group scheme
Adaeze, an office administrator, hurts one of her hands, causing permanent damage, and has to be re-employed on a lower salary. What effect would her return to work have on her IPI benefits?
A) full benefits would be paid until Adaeze has fully recovered.
B) proportionate benefits would be paid but no other claims under the policy would be accepted by the insurance company.
C) benefits would cease immediately.
D) proportionate benefits would be paid until retirement, death or the end of the policy.
D) proportionate benefits would be paid until retirement, death or the end of the policy.
Annette, who retured last year, has developed arthritus and beeds a hip replacement. Under which of the following types of insurance policy might she be able to claim benefits?
A) critical illness cover
B) accident, sickness, unemployment insurance.
C) private medical insurance
D) income protection insurance
C) private medical insurance
Vanessa is unhappy in her current job and has decided to resign. She will be able to claim beneifts under her ASU policy to tide her over until she finds a new post. True or false?
False
The insurance will not pay out to those who resign voluntarily
Roger, who is 78, is finding it difficult to look after himself at home and is planning to move into residentual care next month. He has purchased an immediate needs annuity so his fees will be paid direct to the provider once tax has been deducted. True or false?
False
With an immediate needs annuity the fees are paid to the care provider but tax free.
General insurance policies operate on the principle that policyholders should be restored to the position they were in before the event occured that led to their claim. True or false?
True.
This is the principle of indemnity
Steve’s home contents were insured for £25,000. Last winter his kitchen was flooded and he claimed under his contents insurance for £6,000 damage to kitchen appliances. His insurance established he should have been insured for £32,000. Calculate how much Steve actually received once his insurers established he was underinsured.
25,000 divided by 32,000 = 0.78 x 6000 = £4687.50 (less any excess)
It is illegal to drive a vehicle on public roads in the UK unless you have insurance that covers damage to your car or injury to yourself. True or false?
False.
Insurance is required to cover 3rd parties injury and damage to their property
