Released CII IF1 Updated Questions PDF
IF1 Dumps and Practice Test (100 Exam Questions)
NEW QUESTION 27
If an insurer invokes the cancellation clause to cancel a policy mid-year due to a change in the risk, how much of the premium, if anything, is normally returned to the policyholder?
- A. The full year's premium less a fixed nominal charge.
- B. None of the premium.
- C. The full year's premium.
- D. A pro rata amount.
Answer: A
NEW QUESTION 28
What is the principal reason for which a proposer is asked by the insurer whether his car will be driven by anyone else?
- A. To enable a loading to be applied.
- B. To establish whether insurable interest exists.
- C. It is a material circumstance.
- D. To enable a discount to be applied.
Answer: C
NEW QUESTION 29
Self-insurance arises when a
- A. policyholder decides to insure proportions of his property with different insurers.
- B. policyholder finds that he has inadvertently taken out more than one policy covering the same risk.
- C. number of insurers agree to collectively insure a particular risk in agreed proportions.
- D. company decides to set aside a fund to pay losses that may occur.
Answer: D
NEW QUESTION 30
From April 2019. a small company with nine employees is in dispute with its insurer and wishes to refer the matter to the Financial Ombudsman Service (FOS). The FOS is only permitted lo deal with the dispute if the insured's turnover does NOT exceed
- A. £3,500,000
- B. £1,000,000
- C. £6,000,000
- D. £6,500,000
Answer: B
NEW QUESTION 31
An agent, acting outside the terms of her agency agreement, binds her principal to a contract with a third party who has reason to believe that the agent can act in that capacity. On what basis, if al all, is the principal bound by the agent's actions?
- A. Necessity.
- B. Apparent authority.
- C. Not at all.
- D. Consent.
Answer: B
NEW QUESTION 32
When should a direct insurer advise a policyholder in writing of its complaints-handling procedure, to comply with regulatory requirements?
- A. At the lime of a claim.
- B. Within 30 days of cover being incepted.
- C. At the time of the sale or immediately afterwards.
- D. Within 7 days of a complaint being made.
Answer: C
NEW QUESTION 33
Which professional body specialises in giving its members advice on the long-term management of assets and liabilities?
- A. The International Underwriting Association of London.
- B. The Lloyd's Market Association.
- C. The Institute and Faculty of Actuaries.
- D. The Chartered Institute of Loss Adjusters.
Answer: C
NEW QUESTION 34
A risk that is always insurable is a
- A. speculative risk.
- B. fundamental risk.
- C. capital risk.
- D. pure risk.
Answer: D
NEW QUESTION 35
If the amount to be paid in the event of a total loss of insured property is agreed between the proposer and the insurer at inception of the policy, this is a modification of the principle of
- A. good faith.
- B. indemnity.
- C. subrogation.
- D. contribution.
Answer: B
NEW QUESTION 36
The accident record for a printworks show that for every one major injury, there have been 30 minor incidents and 900 non-injury events reported. How would major work injuries be classified in relation to frequency and severity?
- A. Low frequency, high severity.
- B. Low frequency, low severity.
- C. High frequency, high severity.
- D. High frequency, low severity.
Answer: A
NEW QUESTION 37
The requirement 10 notify the fitting of a more powerful engine under a motor insurance policy is an example of a policy wording modifying the principle of
- A. indemnity.
- B. subrogation.
- C. contribution.
- D. good faith.
Answer: D
NEW QUESTION 38
An insurance company has employed an individual from a rival firm to carry out a similar job. At which stage would the regulatory requirements for retaining training and competence records first apply to the new employee, if at all?
- A. From the initial interview.
- B. When the employee first has contact with members of the public.
- C. Within 18 months of employment.
- D. It would not apply, as the employee is already fully competent.
Answer: B
NEW QUESTION 39
If a surveyor is sent lo survey a risk, what does risk primarily refer to in this context?
- A. The policyholder.
- B. The premises.
- C. The policy cover details.
- D. The insured perils.
Answer: B
NEW QUESTION 40
To whom, if anyone, can an agent normally delegate the responsibility imposed on net under an agency agreement?
- A. To anyone able to fulfil the duties.
- B. The agent cannot delegate her responsibility.
- C. To suitably qualified individuals only.
- D. To suitably experienced individuals only.
Answer: B
NEW QUESTION 41
Which distribution channel for household insurance is typically characterised by high advertising and promotional costs, with no payment of commission?
- A. Lloyd's.
- B. Independent brokers.
- C. Direct insurers.
- D. Appointed representatives.
Answer: C
NEW QUESTION 42
Under the Insurance: Conduct of Business sourcebook (ICOBS) on product disclosure, what information about the claims-handling process must an intermediary provide to a consumer?
- A. The contact details of the loss adjuster used by the insurer.
- B. The contact details of the insurer.
- C. The policy number only.
- D. The number of days the settlement should take.
Answer: A
NEW QUESTION 43
The Principles for Business slate that all customers should be treated
- A. fairly.
- B. with due respect.
- C. equally.
- D. to a minimum standard.
Answer: A
NEW QUESTION 44
It is important to ensure the fair treatment of customers in order to comply with rules set by the
- A. Association of British Insurers.
- B. British Insurance Brokers' Association.
- C. Financial Conduct Authority.
- D. Chartered Insurance Institute.
Answer: C
NEW QUESTION 45
If a proposer has failed to fully answer a question on a proposal form, the insurer is deemed to have waived its rights to this information because it
- A. does not have the right to ask the proposer for more information.
- B. did not request further information.
- C. has statistics on similar risks.
- D. should be able to underwrite the risk based on the information already provided.
Answer: B
NEW QUESTION 46
A claim has arisen which is fully covered under insurer A's policy and insurer B's policy. Insurer A's policy has a sum insured of £30,000 and insurer B's policy has a sum insured of £50,000. What proportion of the claim is insurer B liable for if the principle of contribution applies on a rateable proportion by sum insured basis?
- A. Three eighths.
- B. Two fifths.
- C. Three fifths.
- D. Five eighths.
Answer: D
NEW QUESTION 47
Under a coinsurance arrangement, who is ultimately responsible for payment of an agreed claim?
- A. The intermediary.
- B. Each coinsurer for its own proportion only.
- C. The lead insurer.
- D. Each coinsurer for its own proportion, but also a share of any proportion unpaid due to the default of another coinsurer.
Answer: B
NEW QUESTION 48
A firm of insurance brokers invite Stuart. an underwriter who handles its account, on a Caribbean cruise with his family. How should Stuart react to this invitation in order to comply with the Chartered Insurance Institute's Code of Ethics?
- A. Accept only on the basis that the cost is less than £1.000.
- B. Accept on the basis that this is an accepted business practice.
- C. Decline as this is against the Financial Ombudsman Service regulations.
- D. Decline to avoid any suggestion he is being compromised.
Answer: D
NEW QUESTION 49
Reinsurance is usually purchased by the
- A. intermediary.
- B. insured.
- C. insurer.
- D. regulator.
Answer: C
NEW QUESTION 50
The main purpose of the fair treatment of customers initiative is to
- A. build consumer confidence in the financial services industry.
- B. ensure all firms have a similar service standard.
- C. make firms more competitive.
- D. apply fixed times for responding to claims and complaints.
Answer: A
NEW QUESTION 51
How would an employee benefit directly from her employer's business interruption insurance if its factory was forced to close temporarily due to flood damage?
- A. By continuation of her wages.
- B. By payment of an early retirement pension.
- C. By compensation for loss of bonus.
- D. By payment of a redundancy lump sum.
Answer: A
NEW QUESTION 52
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