Topic 16 Flashcards
Nick is single, has no dependents and is self-employed. He has £200 per month in disposable income after paying his rent and bills. He also has limited savings.
Assuming Nick has home insurance but no other financial protection products, in what respect, if at all, are his financial protection arrangements inadequate?
a. He has no protection if he dies.
b. He has no protection against long-term illness.
c. He has no unemployment cover.
d. His financial protection arrangements are adequate.
b. He has no protection against long-term illness.
According to the FCA in 2020, approximately what percentage of income protection customers claim they find the policies hard to understand?
a. 25%.
b. 50%.
c. 75%.
d. 90%.
b. 50%.
Which of the following is true of consumers’ priorities for protection products?
a. Critical illness policies are the most suitable for parents with young children.
b. Income protection insurance is needed for all self-employed individuals.
c. Protection needs always reduce as people get older.
d. They differ depending on a person’s circumstances.
d. They differ depending on a person’s circumstances.
Which of the following individuals are most likely to need to take out a financial protection product?
a. Abbie, who is a single parent with two young children but little or no savings.
b. Ben, who is single and has no debts.
c. Charlie, who is a retired widower.
d. Davina, who has repaid her mortgage and is financially secure.
a. Abbie, who is a single parent with two young children but little or no savings.
When determining the amount of financial protection that a person may need, which of the following should be taken into account?
a. Existing protection only.
b. Existing savings and investments only.
c. Existing saving and investments, existing protection, and state provision.
d. State provision and existing protection only.
c. Existing saving and investments, existing protection, and state provision.
There are a number of reasons why people do not take out financial protection products.
The least likely reason is:
a. it is an unhappy subject.
b. people feel that ‘it won’t happen to me’.
c. the state provides assistance.
d. the cost for some products is low.
d. the cost for some products is low.
Which of the following individuals are most likely to need to take out a financial protection product?
a. Abe and Anna, who have outstanding debts.
b. Bovi, who is single and has a high level of assets.
c. Camuli, who has recently repaid his mortgage and has no further liabilities.
d. Desi, who has repaid his mortgage and recently started receiving his pension income.
a. Abe and Anna, who have outstanding debts.
