This set of questions, courtesy of online CII training package insurance Assess.
Question 1
Which of these insurances covers physical damage or bodily injury caused by a product once it has entered the supply chain?
A. Products contamination
B. Products guarantee
C. Products liability
D. Products recall
Question 2
Why is 'buy to let' insurance cover required?
A. In case the rental income fails to cover the cost of mortgage repayments
B. Because standard household insurance excludes claims arising when the property is being rented
C. In case the investment value of the property falls
D. Because the tenant cannot necessarily be relied upon to arrange property insurance
Question 3
Driving without insurance can be most accurately described as which of these?
A. A criminal offence
B. A negligent act
C. A nuisance
D. A tort
Question 4
In respect of motor claims, which of these statements is a definition of ‘special damages’?
A. Any damages awarded in the light of special circumstances
B. Damages awarded for pain and suffering
C. Damages awarded to penalise the defendant
D. Quantifiable costs incurred between the date of the accident and the date the claim is settled
Question 5
In respect of aircraft insurance, when is the value of an aircraft agreed?
A. At the time of the loss
B. When the insurers settle the claim
C. At the inception of the policy
D. When the aircraft is registered with the appropriate regulatory authority
Question 6
Which of these is true of a political risk insurance policy?
A. It is always assigned to a bank
B. It is limited to a 12-month policy period
C. It is always backed by the government
D. It is a pecuniary loss policy
Question 7
When considering political risk insurance, which of these actions will all underwriters take?
A. Refer to their country risk rating model
B. Deal with country risk after the premium has been fixed
C. Look only at the possibility of invasion
D. Check the credit rating of the insured
Question 8
How many Principles for Businesses does the FCA promote?
A. 10
B. 11
C. 6
D. 8
Question 9
To become a Lloyd's broker, which of these must a firm do?
A. Satisfy the Council of Lloyd's as to its expertise, integrity and financial standing
B. Accept unlimited liability for its actions
C. Agree to place all its business through the Lloyd's market
D. Agree to act for only one Lloyd's syndicate
Question 10
How useful are previous loss statistics to an aviation underwriter when compared to a motor underwriter?
A. Aviation underwriters are more able to rely on statistics of past losses as an indicator for future claims
B. Both aviation and motor underwriters are equally able to rely on statistics of past losses as an indicator for future claims
C. Past loss statistics are of no use to aviation underwriters, who prefer to use statistics provided by the aviation industry safety regulators
D. Aviation underwriters are less able to rely on statistics of past losses as an indicator for future claims
Answers
1C. Product liability insurance applies if the product has entered the supply chain and causes physical damage or bodily injury.
2B. Buy to let insurance cover is essential since standard household insurance policies exclude claims arising when the property is being rented.
3A. It is a criminal offence to use
a vehicle on a road without third party insurance cover as described in the Road Traffic Act.
4D. Special damages relate to quantifiable costs incurred between the date of the accident and the date the claim is settled, for example, actual loss of earnings, medical expenses and care costs.
5C. At the inception of the policy.
6D. This is a pecuniary loss insurance.
7A. Refer to their country risk rating model.
8B. The FCA promotes 11 Principles for Businesses and the PRA publishes eight Fundamental Rules.
9A. Satisfy the Council of Lloyd's as to its expertise, integrity and financial standing.
10D. An aviation underwriter can only use statistics derived from past losses as a guide because they only represent a proportion of the aircraft operating in the field (not all governments are prepared to release statistics).
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