IfSet2010119v1

Question 1

What, in the context of claims handling , is quantum?

A) The basis of claim settlement
B) The amount of cover available under an insurance policy
C) the amount of a claim
D) The amount of any court award

Answer 1

C) the amount of a claim

Question 2

when a policyholder takes reasonable steps to prevent a loss from spreading, what are they effectively doing?

A) meeting an implied duty following a loss
B) adhering to an express duty following a loss
C) following an express condition of their policy
D) meeting the terms of a warranty

Answer 2

A) meeting an implied duty following a loss

Question 3

Each of the following may limit the amount of a claims settlement with the exception of?

A) the sum insured or limit of liability
A) meeting an implied duty following a loss
C) the average clause
D) an excess or deductible

Answer 3

A) meeting an implied duty following a loss

Question 4

Under the insurance act 2015, which one of the following must an insurer now check when establishing whether a claim from a commercial customer is valid, that they did not previously need to confirm? Whether…

A) cover was in force at the time of loss
B) the duty of fair presentation has been complied with
C) the value of loss is reasonable
D) all conditions and warranties have been complied with

Answer 4

B) the duty of fair presentation has been complied with

Question 5

A Personal accident and sickness insurance policy will usually exclude cover for a sickness contracted within how many days of policy inception?

A) 7 days
B) 14 days
C)21 days
D)28 days

Answer 5

C)21 days

Question 6

Which of the following covers under a personal accident and sickness insurance policy typically provides a weekly benefit for a maximum of 104 weeks?

A) death
B) temporary total disablement
C) permanent total disablement
D) hospital charges

Answer 6

B) temporary total disablement

Question 7

Of what are ambulances, cranes and forklift trucks examples of in context of commercial vehicle insurance?

A) industrial vehicles
B) vehicles of special use
C) vehicles of special construction
D) passenger carrying vehicles

Answer 7

C) vehicles of special construction

Question 8

What is subsidence, in the context of buildings insurance?

A) the movement, slippage, swelling or heave of the ground on which the insured building is situated
B) the movement of land on which the insured building stands due to movement of underground works
C) the movement of land on which the insured building stands as a result of swelling of previously dry ground
D) the movement of the insured building due to settlement, shrinkage or tremor

Answer 8

B) the movement of land on which the insured building stands due to movement of underground works

Question 9

By whom is the “standard fire policy” form recommended on the UK insurance market?

A) The financial services authority
B) Lloyd’s of London
C) The British Insurance Brokers Association
D) The Association of British Insurers

Answer 9

D) The Association of British Insurers

Question 10

Which of these are the insured events under a basic creditor insurance policy?

A) parental leave or short time working
B) loss of employment for any reason
C) redundancy and unemployment
D) death and disability

Answer 10

C) redundancy and unemployment

Question 11

What is the usual basis of cover under a household contents insurance policy for the cost of replacing keys and locks after a theft or keys?

A) cover can be arranged for by extension
B) cover is sub-limited and subject to a specified excess
C) cover is available as standard
D) cover is automatically provided on a reinstatement only basis

Answer 11

A) cover can be arranged for by extension

Question 12

With what type of insurance are specified working expenses and gross profit associated?

A) Professional Indemnity Insurance
B) Business Interruption Insurance
C) Legal Expenses Insurance
D) Commercial Property Insurance

Answer 12

B) Business Interruption Insurance

Question 13

For what reason is theft insurance often arranged on a “first loss” basis?

A) the policyholder recognises that a thief is unlikely to steal all of the insured property
B) to reduce policy excesses and therefore, the premium due
C) to avoid the need to provide documentary evidence of ownership in the event of a claim
D) the insurers recognise that it is likely that cover will need to be reinstated to the full sum insured more than once during the policy period

Answer 13

A) the policyholder recognises that a thief is unlikely to steal all of the insured property

Question 14

Who in the insurance relationship is the second party?

A) the insurer
B) the insured
C) anyone involved in a loss event caused by the insured
D) anyone witness to a loss event caused by the insured

Answer 14

A) the insurer

Question 15

Of what is effective claims reserving a key indicator?

A) A profitable underwriting portfolio
B) A company’s ability to manage fraudulent claims
C) A company’s compliance with ICOBS
D) A Company’s financial solvency

Answer 15

D) A Company’s financial solvency

Question 16

What is the relationship of a third party with the insurer in a third party claim?

A) there is a relationship “by proxy” between the third party and the insurer
B) there is no contractual relationship between the third party and insurer
C) there is a contractual relationship between the third party and the insurer
D) there is a legally enforceable relationship between the third party and the insurer

Answer 16

B) there is no contractual relationship between the third party and insurer

Question 17

What is the objective of the Art Loss Register?

A) to assist insurers in determining whether a piece of art or an antique is being claimed for more than once through the provision of the details of all artwork registered in the UK
B) to assist insurers in checking the true claims history of fine art claimants through subscription to an exchange
C) to increase the recovery rate of stolen artwork and deter theft by making resale of stolen items more difficult
D) to assist the police in tackling theft of fine art through the provision of details of all artwork registered in the UK

Answer 17

C) to increase the recovery rate of stolen artwork and deter theft by making resale of stolen items more difficult

Question 18

What are the town broad options to consider when seeking a resolution to disputes by alternative dispute resolution (ADR)?

A) Statutory and Non-Statutory
B) Binding and Non-Binding
C) Adjudicative and Non-Adjudicative
D) Criminal and Civil

Answer 18

C) Adjudicative and Non-Adjudicative

Question 19

What means may firms use to effectively demonstrate they are consistently providing fair treatment of their customers?

A) Implementation of operating manuals
B) use and analysis of complaint logs
C) customer surveys and questionnaires
D) delivering on the FCA’s six customer outcomes

Answer 19

D) delivering on the FCA’s six customer outcomes

Question 20

“They were introduced with the intention of reducing cost, delay and complexity in the way personal injury claims were handles” what are we describing?

A) The Civil Procedure Rules
B) The Financial Conduct Authority Rules
C) The Financial Services and Market Acts
D) The Alternative Dispute Resolution Regulations

Answer 20

A) The Civil Procedure Rules

Question 21

What is the scope of the Personal Injury Pre-Action Protocols under the Civil Procedure Rules?

A) they include all personal injury claims
B) they include all personal injury claims arising from motor incidents
C) they include all non-motor personal injury claims
D) they include all personal injury claims arising from non-commercial incidents

Answer 21

A) they include all personal injury claims

Question 22

A Claim form will need to be completed for claims under each of the following insurances with the exception of?

A) Extended Warranty
B) Household Contents
C) Travel
D) Pet

Answer 22

A) Extended Warranty

Question 23

As a result of a two-vehicle collision, a policyholder with a third party, fire and theft policy is left with damage to their rear bumper. The policyholder notifies their insurer of the incident and the responsibility for the collision is subsequently found to be that of the other driver. What should the policyholder do in relation to re compensate for the costs of repairs to the damaged bumper?

A) they have no route of compensate and must meet the costs of repair themselves
B) they must refer the incident to the motor insurers bureau as an uninsured loss
C) they must now make a third-party claim against the other driver
D) they must now make a claim against their own policy

Answer 23

C) they must now make a third-party claim against the other driver

Question 24

For the purpose of household insurance, what are “durable goods”?

A) clothing, bedding, towels and curtains
B) Permanent fixtures and fittings
C) Items acquired by the policyholder prior to the period of cover which are more than ten years old
D) household furniture, refrigerators, freezers and so on

Answer 24

D) household furniture, refrigerators, freezers and so on

Question 25

What is the usual basis of settlement for claims under the buildings section of a new household insurance policy?

A) New for Old
B) Reinstatement with betterment
C) Repair less betterment
D) First Loss

Answer 25

C) Repair less betterment

Question 26

What are the insured causes of loss or damage under a public liability policy?

A) The insured’s professional negligence in relation to a third party
B) the insured’s negligence or breach of statutory duty towards a third party
C) the insured’s failure in their duty of care towards the public and/or their employees
D) the insured’s breach of common law in relation to a third party

Answer 26

B) the insured’s negligence or breach of statutory duty towards a third party

Question 27

Establishing whether a policyholder has alternative premises or whether they have a disaster recovery plan are key pieces of information to obtain at the proposal stage for which type of insurance policy?

A) Employers liability
B) Professional Indemnity
C) Business Interruption
D) Products Liability

Answer 27

C) Business Interruption

Question 28

“They are damages for losses that can be quantified”. What are we describing here?

A) Special Damages
B) Indemnification
C) Compensation
D) General Damages

Answer 28

A) Special Damages

Question 29

Each of the following is a plausible reason for insures electing to outsource telephone helplines to specialist providers with the exception of:

A) Access to specialist IT
B) Economies of scale
C) Risk Transfer
D) Experience of the provider

Answer 29

C) Risk Transfer

Question 30

Which of these are key considerations when designing a claims management system?

A) The characteristics and cost of claims
B) The volume and complexity of claims
C) the frequency and severity of claims
D) The occurrence and nature of claims

Answer 30

B) The volume and complexity of claims

Question 31

Single data entry is just one of the benefits of using IT in claims handling. What does this mean for claims handlers in practice?

A) Fewer people involved in entering data and therefore, a reduction in errors during input
B) Speeding up of claims settlement process and improved job satisfaction
C) Quicker distribution of claims date to the various parties involved and therefore improved communications
D) Fewer people involved in the claims decision process and therefore, an increase in consistency

Answer 31

A) Fewer people involved in entering data and therefore, a reduction in errors during input

Question 32

Who is the “ultimate customer” of a claims management system?

A) the insurer
B) the claims handler
C) the user
D) the policyholder

Answer 32

D) the policyholder

Question 33

Which of these is an advantage of an organisation with a functional structure?

A) small units are likely to be highly cost effective
B) there is diversity in the procedures used
C) Employees are able to specialise in their type of work
D) communications between functions tend to be strong

Answer 33

C) Employees are able to specialise in their type of work

Question 34

When preparing a report in relation to a commercial risk, a surveyor refers to the “MPL”. What does this abbreviation mean?

A) A Measure of the maximum possible loss that could occur
B) a measure of the minimum potential loss that will arise
C) the maximum profit and loss of the potential insured’s business
D) the maximum probable loss that could occur

Answer 34

D) the maximum probable loss that could occur

Question 35

How is it possible for a claims management system to adversely affect the cash flow of an insurer?

A) the system may lead to the incurring of regulatory penalties and fines
B) the system will speed up claims settlements but not reinsurance recoveries
C) the system may be expensive to develop and implement
D) the system may lead to more claims being settled

Answer 35

B) the system will speed up claims settlements but not reinsurance recoveries

Question 36

What is a Loss Development Factor Method?

A) A means of assessing the MPL when surveying a risk
B) A cross-market standard for assessing exposure to risk
C) A method used to project claims for reserving purposes
D) a method used to collate claims for reserving purposes

Answer 36

C) A method used to project claims for reserving purposes

Question 37

When collating historical data for claims reserving purposes, which of these important criteria must be met?

A) the groupings created must contain sufficient data to maintain statistical credibility
B) segmentation must account for a review of past and present claims procedures
C) Statistics produced through banding must allow for differences in customer perception
D) classification of data must be in line with industry standards to ensure cross market consistency

Answer 37

A) the groupings created must contain sufficient data to maintain statistical credibility

Question 38

In which of these circumstances does the average condition on a property policy lead to a limit on the amount settled by the claims handler?

A) where the policyholder has more than one insurance covering the same loss
B) where there is a limit evidence of proof of value, ownership or purchase of a lost or stolen item
C) where the policy holder is under-insured
D) where the policyholder has failed to declare material facts

Answer 38

C) where the policy holder is under-insured