Unit 5 Topic 17

Question 1

David has previously benefitted from Support for Mortgage Interest (SMI) loan
payments, which ceased when he found a new job. If he loses his job again and
makes a new claim for SMI, he will not be subject to a waiting period provided
that his previous SMI claim:
A ceased within the last 52 weeks
B ceased more than 52 weeks ago
C was for fewer than 26 weeks
D was for more than 26 week

Answer 1

A ceased within the last 52 weeks

Question 2

Statutory Sick Pay payments are subject to which of the following potential 
deductions if any? 
A both income tax and national insurance
B income tax only
C national insurance only
D none

Answer 2

A both income tax and national insurance

Question 3

A key benefit of an IPI policy over a CIC policy is that an IPI policy:
A can be written in trust
B includes a waiver of premium extension
C pays a lump sum
D provides a benefit if the policyholder is unable to work

Answer 3

D provides a benefit if the policyholder is unable to work

Question 4

Which of the following conditions is least likely to be covered under a critical 
illness policy? 
A deafness
B first degree burns
C heart valve repair
D loss of a limb

Answer 4

B first degree burns

Question 5

Molly and Fred have chosen to protect their repayment mortgage with a joint
life level term assurance policy rather than with a mortgage protection policy.
What advantage would this potentially give them?
A a potential surplus to the surviving borrower on first death
B a reduced premium during the initial term of the policy
C a terminal bonus paid on first death or maturity
D an option to convert the policy to an endowment

Answer 5

A a potential surplus to the surviving borrower on first death

Question 6

Which of the following medical problems would not be a core medical
condition under the ABI’s Minimum Standards for critical illness assuming all
of the conditions meet the specified criteria on diagnosis?
A cancer
B heart attack
C kidney failure
D stroke

Answer 6

C kidney failure

Question 7

Matthew has been given various pieces of information regarding critical
illness. Which of the following is correct?
A it would pay benefits immediately on diagnosis of a serious illness
B Matthew may have to repay some of the benefits if he recovers after making a
claim
C Matthew would have survive for up to 28 days after diagnosis for benefits to
be paid.
D The plan would always stop in the event of a claim

Answer 7

C Matthew would have survive for up to 28 days after diagnosis for benefits to
be paid.

Question 8

What is the purpose of a convertible term assurance plan? To:
A allow it to be converted into a joint life plan at some point during the policy
B allow the original policy to be converted without any increased premiums
C enable the original sum assured to increase within specified limits without
any evidence of health
D enable the plan holder to convert it into a whole of life or endowment policy
during the term

Answer 8

D enable the plan holder to convert it into a whole of life or endowment policy
during the term

Question 9

n normal circumstances, what minimum age limit applies for Universal Credit?
A it is available from birth
B 18 years
C 21 years
D state pension age

Answer 9

B 18 years

Question 10

Terry has a mortgage for £300,000 and has had a claim for Support for
Mortgage Interest (SMI) approved. What maximum amount of mortgage
interest payments will be covered by SMI?
A £100,000
B £150,000
C £200,000
D £300,000

Answer 10

C £200,000

Question 11

Which of the following is true in relation to income protection insurance and
critical illness cover?
A critical illness cover provides a taxable lump sum on diagnosis of a defined
illness
B critical illness cover provides income benefits only
C there is no limit to the level of benefit that can be arranged on income
protection insurance policy.
D There is no limit to the number of claims that can be made on income
protection insurance provided that the premiums are up to date.

Answer 11

D There is no limit to the number of claims that can be made on income
protection insurance provided that the premiums are up to date.

Question 12

Why might a customer prefer to take out an income protection insurance policy
rather than a critical illness policy?
A they have reached state retirement age
B they are unemployed
C to provide a regular income if unable to work
D to receive a lump sum

Answer 12

C to provide a regular income if unable to work

Question 13

Alan has a CIC policy with reviewable premiums. The premiums will be
reviewed in line with the insurer’s:
A claims experience only
B investment returns only
C claims experience and expenses only
D claims experience, investment returns and expenses

Answer 13

D claims experience, investment returns and expenses

Question 14

A person is ineligible to receive Universal credit if their household savings 
exceed: 
A £3,000
B £9,000
C £10,000
D £16,000

Answer 14

D £16,000

Question 15

Statutory sick pay (SSP) is payable for a maximum of:
A 13 weeks
B 26 weeks
C 28 weeks
D 52 weeks

Answer 15

C 28 weeks

Question 16

Personal independence payment (PIP) is payable to a person who has had
difficulties with daily living or mobility for a minimum of the previous:
A one month
B three months
C six months
D nine months

Answer 16

B three months

Question 17

Where a life insurance policy has lapsed, within that maximum period will the
insurer typically allow the policy to be reinstalled, provided that all outstanding
premiums are paid?
A 6 months
B 9 months
C 12 months
D 24 months

Answer 17

C 12 months

Question 18

How long is the typical survival period under a critical illness insurance policy?
A 7 to 10 days
B 14 to 28 days
C 30 to 60 days
D 90 to 365 days

Answer 18

B 14 to 28 days