IF2Set3010118v2 Flashcards
In the UK, the minimum cover required to comply with motor legislation is: A. third party only B. comprehensive C. Road Traffic Act only D. third party, fire and theft
C. Road Traffic Act only
Which of these is not something that must be covered under the Road Traffic Act 1988?
A. Indemnity to third parties if they are held wholly liable for an accident
B. Indemnity for claimants’ costs and the expenses of handling the claim
C. Indemnity for bodily injury or death to third parties, including passengers
D. Indemnity for loss or damage to third party property
A. Indemnity to third parties if they are held wholly liable for an accident
A comprehensive motor insurance policy will exclude cover for:
A. personal belongings of the driver
B. personal accident cover for the driver
C. mechanical and electrical failure
D. medical expenses for the insured
C. mechanical and electrical failure
Alice has five years’ no claim discount and is worried about losing this if she has an accident. Which type of no claim discount should she purchase from her insurer to solve this problem? A. Protected B. Entitled C. Defined D. Guaranteed
A. Protected
The recognised international certificate for cover to drive abroad is otherwise known as a Green: A. bond B. flag C. cross D. card
D. card
Which of these would be classed as a vehicle of special construction under a commercial motor policy? A. Bus B. Crane C. Tractor D. Lorry
B. Crane
Which type of cover can be provided under a policy for a private car, but is usually excluded from a commercial motor insurance policy? A. Driving other vehicles B. Windscreen cover C. Personal belongings D. Trailers attached to the vehicle
A. Driving other vehicles
What is the main rating factor for personal accident insurance? A. Age of proposer B. Occupation of proposer C. Gender of proposer D. Medical history of proposer
B. Occupation of proposer
Sam has two personal accident policies. In the event of an insured event he can claim for a lump sum benefit from:
A. both policies
B. one policy
C. neither policy, because having two policies is fraudulent
D. both policies, but contribution will apply
A. both policies
Which of the following policies would have the narrowest cover in relation to its legal expenses cover? A. Household B. Group legal expenses C. Personal accident and sickness cover D. Travel
C. Personal accident and sickness cover
The time limit under the sickness section of a personal accident policy before which no benefit is payable is called: A. a waiting period B. an indemnity C. an excess D. a franchise
D. a franchise
Some companies offer higher weekly benefit limits for temporary total disablement for a lesser period of: A. 4 weeks B. 13 weeks C. 26 weeks D. 52 weeks
D. 52 weeks
What benefit is usually payable if a person dies after a personal accident policy has already paid out a lump sum for total disablement? A. A lump sum of half the sum insured B. A lump sum of twice the sum insured C. Nothing – there is no further benefit D. An annuity for 10 years
C. Nothing – there is no further benefit
Medical expenses insurance usually excludes cover for medical treatment in the last: A. 1 year B. 2 years C. 5 years D. 10 years
C. 5 years
It is possible to add cover for each of the following as an optional extension to a household policy with the exception of: A. small craft B. caravan C. bike D. car
D. car
Norton Engineering who are a large commercial firm, have a policy which groups together different policies that each have different underwriting conditions. What is this kind of policy called? A. A group policy B. A package policy C. A combined policy D. A standardised policy
C. A combined policy
What is another name for 'new for old' cover? A. Reinsurance B. Reinstatement C. Indemnity D. Settlement
B. Reinstatement
Which of these would usually be excluded under the buildings section of a household insurance policy? A. Escape of water or oil B. Falling trees or branches C. Storm damage to fences D. Theft or attempted theft
C. Storm damage to fences
What is cover for the event of an aircraft crashing into a building called? A. Escape B. Strike C. Heave D. Impact
D. Impact
Which of these is a recognised guide for determining what constitutes a ‘building’ for household insurance purposes?
A. Any part of the core structure of the main insured premises
B. Anything that would normally be left behind when moving from a house
C. Anything which is fixed or permanent
D. Anything not capable of being left behind when moving from a house
B. Anything that would normally be left behind when moving from a house
What is the usual single item limit under household contents insurance? A. 5% of total contents sum insured B. 10% of total contents sum insured C. 20% of total contents sum insured D. 25% of total contents sum insured
A. 5% of total contents sum insured
Which of the following covers is typically included as standard in a travel insurance policy? A. Delayed baggage B. Failure of tour organiser C. Loss of passport D. Legal expenses
A. Delayed baggage
The maximum sum insured under the baggage, personal effects and money cover of a travel policy will be higher if which of the following are included within the scope of cover? A. Credit vouchers B. Passports C. Travellers’ cheques D. Travel tickets
B. Passports
Under a standard fire policy, what cover is provided to a limited extent? A. Fire B. Lightning C. Explosion D. Subterranean fire
C. Explosion
In the ABI Standard Fire and Special Perils Policy (Material Damage) wording, which term is taken to mean ‘the loss or destruction of or damage to the property insured’? A. DAMAGE B. LOSS C. DESTRUCTION D. HARM
A. DAMAGE
Cover within a standard fire and perils policy for explosion of boilers or gas is restricted to: A. domestic purposes B. commercial purposes C. domestic and commercial purposes D. industrial purposes
A. domestic purposes
What must a special peril result in for cover to apply? A. Damage to property B. Third party liability C. Consequential loss D. Physical injury to a person
A. Damage to property
Flood cover is only issued in conjunction with: A. impact cover B. storm cover C. escape of water D. theft cover
B. storm cover
Kevin's home in Bognor Regis is damaged by a sudden rise in sea levels. Which special peril applies? A. Storm B. Flood C. Escape of water D. Impact
B. Flood
Which of these can be covered under the special peril of subsidence, ground heave and landslip?
A. Damage to a car park, where the insured’s building has not been damaged
B. Damage caused by construction
C. Movement of foundations caused by changes in soil
D. Damage caused by subterranean fire
C. Movement of foundations caused by changes in soil
The widest scope of cover is offered by: A. the Lloyd's standard fire policy B. the ABI standard fire policy C. a fire and special perils policy D. an ‘all risks’ policy
D. an ‘all risks’ policy
Which of these is an absolute exclusion under an "all risks" policy? A. Theft B. Money C. Specific insurance D. Accidental damage
C. Specific insurance
An insured can get a discount in premium by requesting a sum insured based on the proportion of their property that is likely to be lost in one incident. This is called a: A. minimum sum insured B. first loss sum insured C. limit of liability D. catastrophe sum insured
B. first loss sum insured
A common automatic extension under a theft policy is: A. robbery and aggravated burglary B. fire and explosion C. collusion D. replacement of keys
D. replacement of keys
Which of these policies is not usually subject to average because the sums chosen are limits rather than sums insured? A. Money B. Theft C. Fire D. Commercial property
A. Money
Which of following is an example of a pecuniary insurance? A. Legal expenses B. Theft C. Fire and special perils D. Motor
A. Legal expenses
Under which type of policy would you expect cover to be available as standard for copyright disputes? A. Products liability B. Group legal expenses C. Employers’ liability D. Commercial legal protection
D. Commercial legal protection
Which of the following statements regarding commercial legal protection is TRUE?
A. It can cover the costs of defending an action by an employee, plus awards made against the company if its defence is unsuccessful
B. Employment, personal, motor and conveyancing cover are included as standard
C. It can cover the costs of a criminal action brought against the company, plus fines which may be imposed
D. Conveyancing cover can be added as an optional extension
A. It can cover the costs of defending an action by an employee, plus awards made against the company if its defence is unsuccessful
Which of the following is available as an optional extension to a commercial legal protection policy? A. Motor cover B. Property disputes cover C. Cover against taxation proceedings D. Conveyancing cover
C. Cover against taxation proceedings
Business interruption insurance is designed to protect: A. both fixed and variable charges B. turnover and net profit C. net profit and variable charges D. net profit and fixed charges
D. net profit and fixed charges
In business interruption insurance, insurers use the "difference basis" of cover to calculate how much a company has lost whilst not operational. How is this calculated? A. Gross profit minus turnover B. Turnover minus net profit C. Turnover minus fixed charges D. Turnover minus variable charges
D. Turnover minus variable charges
Assuming no optional extensions have been selected, cover for business interruption will be limited to the insured’s: A. own premises B. supplier’s premises C. customer’s premises D. utility provider’s premises
A. own premises
What is the requirement to have a policy in place for the physical damage which has caused the loss of income being claimed for under a business interruption policy called? A. Physical damage warranty B. Commercial warranty C. Special perils warranty D. Material damage warranty
D. Material damage warranty
What accounts for the vast majority of actions to recover damages? A. Negligence B. Property damage C. Nuisance D. Contracts
A. Negligence
Which of these would be excluded from cover by an employers’ liability insurance?
A. Pure accidents
B. Death due to the employer’s negligence
C. Occupational asthma
D. Injuries caused by work equipment
A. Pure accidents
An employers’ liability policy cannot offer an employee compensation for: A. pain and suffering B. future earnings C. damage to personal property D. loss of earnings
C. damage to personal property
Which of these is a standard extension on an employers’ liability insurance?
A. Claims made basis
B. Defence cost and expenses
C. Cover for employee’s personal property
D. Claimant’s costs and expenses
B. Defence cost and expenses
What is the usual limit of indemnity under public liability cover? A. £500,000 B. £1,000,000 C. £2,000,000 D. £5,000,000
C. £2,000,000
Which of the following limitations is common to both public and products liability insurance? A. Contractual liability B. Damage to goods supplied C. Faulty design or formula D. Failure to perform
A. Contractual liability
Professional indemnity insurance usually excludes:
A. an insurance broker confirming cover, but forgetting to arrange it
B. a surveyor unknowingly giving incorrect advice, resulting in the purchase of a defective property
C. an investment consultant accidentally inputting the wrong figures into a spreadsheet, resulting in financial loss
D. an adviser deliberately omitting a fact on a proposal form, resulting in the insurance company voiding the policy
D. an adviser deliberately omitting a fact on a proposal form, resulting in the insurance company voiding the policy
Which of the following types of insurance is most likely to offer bereavement counselling? A. Motor B. Travel C. Pet D. Home
C. Pet
What do motor insurers usually call their authorised repairers? A. Approved repairers B. Preferred repairers C. Permitted repairers D. Allowed repairers
A. Approved repairers
An insurer’s main concern in risk control is usually to deal with:
A. labour relations issues
B. areas that will have an impact on risk
C. retention issues in the risk pool
D. issues of competition
B. areas that will have an impact on risk
What are a surveyor's recommendations regarding things that must be done for the risk to be accepted called? A. Risk arrangements B. Risk recommendations C. Risk requirements D. Risk reversal
C. Risk requirements
Which of these is not usually considered by insurers for the transit risk in money insurance? A. The method of transit used B. The sums involved C. The adequacy of training D. Number of people involved
C. The adequacy of training
What is generally the greatest risk under a public liability insurance?
A. Staff relations
B. Employment terms and conditions
C. Visitors to the insured’s premises
D. Damage that employees could do to third party premises
D. Damage that employees could do to third party premises
Which insurance area employs the most specialist surveyors? A. Money B. Material damage C. Engineering D. Products Liability
C. Engineering
Which of the following specialists are most notably involved in pursuing claims for uninsured loss recovery? A. Loss assessors B. Claims handlers C. Solicitors D. Loss adjusters
C. Solicitors
Duncan parks his car in a garage. In doing so he may benefit from a cheaper premium because this is an example of a: A. poor physical hazard B. good moral hazard C. good physical hazard D. poor moral hazard
C. good physical hazard
In personal accident insurance, a significant rating factor is the proposer’s: A. name B. address C. occupation D. retirement plans
C. occupation
Why do insurers use surveys as another way of getting material information?
A. To eliminate the need for a proposal form
B. To save money
C. To obtain a fuller picture of the risk than a written summary from the insured
D. To eliminate flood risks
C. To obtain a fuller picture of the risk than a written summary from the insured
FCA rules on the negotiation of an insurance contract are contained in which Sourcebook? A. MCOBS B. PRU C. ICOBS D. PRA
C. ICOBS
Introducer appointed representatives may get involved in distributing: A. cover notes B. insurance certificates C. proposal forms D. claims settlements
C. proposal forms
How much insurance premium tax would be charged on a motor insurance premium of £250? A. £18.75 B. £23.75 C. £25 D. £30
D. £30
The sales of insurance policies by telephone are specifically governed by: A. ICOBS B. the Consumer Rights Act 2015 C. the Distance Marketing Directive D. the Insurance Act 2015
C. the Distance Marketing Directive
Which of the following would an intermediary be expected to declare for all types of contract, even though there is no specific guidance on this from the FCA?
A. Any demands and needs that are not met
B. Where it owns more than 10% of another insurer
C. The duration of the insurance contract
D. Contact details of how a claim may be notified
A. Any demands and needs that are not met
Which of these would be the most appropriate means of establishing customer demands and needs for a private motor insurance policy? A. A survey B. A proposal form C. A detailed checklist D. A demands and needs analysis form
B. A proposal form
What additional requirement must an intermediary establish when determining the suitability of a protection policy for a customer?
A. The customer should be eligible to claim benefit
B. The customer should be able to afford the premium
C. The customer should understand the policy terms and conditions
D. The customer should complete a proposal form
A. The customer should be eligible to claim benefit
The most common type of policy for which EDI systems are used is: A. private motor insurance B. travel insurance C. commercial property insurance D. household insurance
A. private motor insurance
Credit facilities, instalments and third-party financing are all methods of what? A. Broadening market appeal to customers B. Premium collection C. Improving moral risk D. Reducing claims occurrences
B. Premium collection
In policy wording, an alternative term for exclusion is: A. condition B. franchise C. exception D. extension
C. exception
An exclusion that applies to all sections of cover under a particular insurance policy is referred to as a: A. specific exclusion B. general exclusion C. policy condition D. market exclusion
B. general exclusion
Which of the following common policy conditions is intended to deal with any disputes that arise as to the amount to be paid in settlement of a claim under a policy? A. Subrogation B. Contribution C. Average D. Arbitration
D. Arbitration
Which of these is typically included in the information section of a policy? A. Claims information B. Policy conditions C. The insured’s details D. Excesses and franchises
A. Claims information
An action which an insurer stipulates in a policy which must be undertaken by the insured is called: A. An excess B. A franchise C. A warranty D. A deduction
C. A warranty
Under a motor insurance policy, a warranty may be:
A. expressed, and relate to past or present facts
B. implied, and relate to past or present facts
C. expressed, but relate only to past facts
D. implied, and relate to a continuing state of affairs
A. expressed, and relate to past or present facts
If a private customer fails to comply with a condition precedent to liability an insurer can:
A. repudiate the contract as a whole
B. refuse liability for a loss that is connected with the breach
C. refuse to pay subsequent losses
D. refuse to pay losses unconnected to the breach
B. refuse liability for a loss that is connected with the breach
What does the FCA stipulate in relation to renewal of insurance policies?
A. Customers do not have to be issued with renewal information unless they make their premium payments in a lump sum
B. Customers should receive notification of renewal within 30 days of the expiry of their current policy
C. Customers should not be pressured to renew
D. Last year’s premium must be disclosed on renewal notices
D. Last year’s premium must be disclosed on renewal notices
What must an insured prove in order to make a claim?
A. That the loss was accidental
B. That the loss was caused by an insured peril
C. That the value of their loss is reasonable
D. That they have complied with all conditions and warranties
B. That the loss was caused by an insured peril
If an insurer has no strict liability to pay a claim but wishes to do so as a good will gesture, this is called: A. subrogation B. contribution C. ex gratia D. indemnity
C. ex gratia
For which of the following claims may it be desirable to obtain an engineer’s report, incorporating scale plans and photographs as supporting evidence? A. Theft B. Accident C. Travel D. Property
B. Accident
An expert who is employed by the insured to prepare their claim is called a loss: A. administrator B. adviser C. adjuster D. assessor
D. assessor
Mr Jones has his camera stolen whilst returning from the airport after his holiday. The camera is covered by his travel insurance and his household contents insurance and is worth £500. Using a rateable proportion calculation, work out how much of the claim his household insurer, who has a sum insured of £800 would share in the claim if the travel insurer has a sum insured of £200? A. £200 B. £400 C. £500 D. £800
B. £400
Which of the following can be described as an alternative method of dispute resolution whereby a third party is selected to act as a facilitator and where, if an agreement is not reached, other legal remedies/options can be pursued? A. Civil procedure B. Arbitration C. Conciliation D. Mediation
D. Mediation
Which of the following provides compensation to victims of ‘hit and run’ cases? A. Road Traffic Act B. Uninsured drivers agreement C. Untraced drivers agreement D. ABI Memorandum of Understanding
C. Untraced drivers agreement
The estimate an insurer puts on the total amount a claim will reach is called: A. a settlement B. a reserve C. a deductible D. an excess
B. a reserve
What are the three categories of information?
A. Private, general, and public
B. Corporate, small business and consumer
C. Sensitive, personal and public
D. Public, corporate and personal
D. Public, corporate and personal
Under the General Data Protection Regulation ‘sensitive personal data’ is now referred to as?
A. Protected personal data
B. Special categories of personal data
C. Restricted categories of personal data
D. Ring-fenced personal data
B. Special categories of personal data
Under the Data Protection Act 2018, the age from which parental consent is not needed to process data online is? A. 11 B. 13 C. 16 D. 18
B. 13
What are the necessary data security requirements for hard copies of documents with restricted access?
A. Storage in a locked filing cabinet
B. Storage in a locked room
C. Scanning and electronic storage on a secure network
D. Storage by an appointed person within the business
A. Storage in a locked filing cabinet
With which area of the insurance market do we usually associate telematics? A. Personal accident B. Travel C. Motor D. Employers’ liability
C. Motor
Which of these has aided the rapid growth of social media?
A. The relaxation of data protection rules
B. The potential for premium reduction
C. The development of new hardware
D. The change in attitude by consumers towards the insurance industry
C. The development of new hardware
What are the specific challenges to employers and insurers of using mobile devices as opposed to desktop computers?
A. They have less data storage capacity
B. They are more prone to viruses
C. They are more susceptible to theft and loss
D. They are more difficult for employees to operate
C. They are more susceptible to theft and loss
Which of these is not a key component of customer service? A. Research B. Strategic Planning C. Marketing D. Finance
D. Finance
What is one of the main factors in the increasing importance of customer service? A. Greater consumer awareness B. Customer apathy C. Lower customer expectations D. Decreased competition
A. Greater consumer awareness
Which of these is a benefit to the insured, rather than the insurer of providing quality customer service? A. Speedy claims settlement B. Customer loyalty C. Increased profitability D. Improved working environment
A. Speedy claims settlement
What is the FCA’s definition of competence?
A. The ability to supervise a function
B. The ability to carry out a function without supervision
C. The ability to carry out a function with minimal supervision
D. The ability to carry out functional tasks
B. The ability to carry out a function without supervision
With respect to the FCA ICOBS, which of these is a reason that the rejection of a claim will be deemed to be reasonable?
A. Breach of warranty or condition where the circumstances of the claim are connected with the breach
B. Non-negligent misrepresentation of a material fact
C. Fraudulent misrepresentation of a material fact
D. Non-disclosure where the policyholder could not reasonably have been expected to disclose the material fact
C. Fraudulent misrepresentation of a material fact
Who can an eligible complainant contact if a firm has not satisfactorily resolved their complaint after 8 weeks? A. The FOS B. The FCA C. The FSCS D. The PRA
A. The FOS
What is the primary function of a customer service strategy?
A. To make customers part of the company’s entire operation
B. To ensure the FCA Handbook is adhered to
C. To ensure a positive customer service culture
D. To ensure the overall fairness of claims settlements
A. To make customers part of the company’s entire operation
