This set of questions, courtesy of online CII training package insurance Assess
Question 1
Why is 'buy to let' insurance cover required?
A. In case the rental income fails to cover the cost of mortgage repayments
B. In case the investment value of the property falls
C. It is not
D. Because standard household insurance excludes claims arising when the property is being rented
Question 2
How does the Motor Insurance Database (MID) assist with the reduction of uninsured driving?
A. It is a fund that compensates the victims of uninsured drivers
B. It enables insurers to access the DVLA records of drivers
C. It is a database of drivers who have been convicted of uninsured driving
D. It enables an insurance check to be made via the registration number of a vehicle
Question 3
For customers, which is often the critical factor in choosing a motor insurer?
A. Cover
B. Loyalty
C. Price
D. Service
Question 4
Under a travel insurance policy, when does cover for holiday cancellation commence?
A. Once the final payment has been made
B. Once the holiday is booked
C. Three months before departure date
D. When the holiday journey starts
Question 5
Why is it often cheaper to buy holiday insurance from vendors at airports?
A. The airport vendors do not have the operating costs of expensive premises
B. The cancellation risk is nominal
C. The cover excludes UK risks
D. The underwriters have to be more competitive to attract business at airports
Question 6
What is the main outcome you would want to achieve when dealing with a vulnerable customer?
A. To make the customer feel valued and supported
B. Renew the customer's repayment plan
C. Avoid any regulatory issues for the firm
D. To show the customer that all is not lost
Question 7
What is the overarching aim for the FCA when considering vulnerable customers?
A. All firms must create and put into practice appropriate strategies to address the needs of consumers in vulnerable circumstances
B. All firms should consider putting into practice appropriate strategies to address the needs of consumers in vulnerable circumstances
C. All firms should have reasonable strategies in place to address the needs of consumers in vulnerable circumstances
D. Some firms should consider putting into practice appropriate strategies to address the needs of consumers in vulnerable circumstances
Question 8
To what extent, if any, are directors' and officers' (D&O) insurers obliged to take control of a claim?
A. D&O insurers are obliged to take full control of a claim
B. There is no obligation for D&O insurers to take control of a claim
C. To no extent; it is forbidden for D&O insurers to take control of a claim
D. To the extent required by the Companies Act
Question 9
How is the renewal of a D&O liability policy underwritten?
A. Companies must provide a new proposal form and audited accounts each year
B. Renewal is offered automatically at existing terms if the risk is claims-free
C. Renewal terms are calculated based on claims experience and the company's most recent report and accounts
D. Renewal terms are only offered once every five years
Question 10
Which of these types of companies pose the highest D&O liability risk?
A. Companies trading with emerging economies
B. Companies who export products to the US
C. Companies with shares traded in the UK
D. Companies with shares traded in the US
Answers
1D. Standard household insurance policies exclude claims arising when the property is being rented.
2D. The MID is a database that contains details of insured vehicles to assist primarily in the identification of uninsured vehicles and drivers.
3C. For customers, price is often a critical factor in deciding which motor insurer to go with.
4B. The cancellation cover commences from when the holiday is booked and continues until departure date.
5B. The cancellation risk
is nominal.
6A. To make the customer feel supported and valued.
7A. All authorised firms must create and put into practice appropriate strategies to address the needs of consumers in vulnerable circumstances.
8B. D&O claims conditions typically confirm that insurers have the right, but are not obliged, to take over the control of the defence of any claim.
9A. Companies are required to complete a fresh proposal form each year and provide the latest audited accounts, etc.
10D. Companies with shares (or American depositary receipts - ADRs) traded in the US or those with US operations (employees) are higher risk than those who export goods to the US.
Your score
1–3 Poor
7–8 Very good
4–6 Good
9-10 Excellent
