Last Updated: Aug 16, 2026
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| Section | Objectives |
|---|---|
| Topic 1: Agency and Insurance Practice | - Authority and responsibilities of agents and brokers - Principles of agency law |
| Topic 2: Legal Principles Relevant to Insurance | - Law of contract
|
| Topic 3: Insurance Principles and Practice | - Principles of insurance (insurable interest, utmost good faith, indemnity) - Claims handling and underwriting basics |
| Topic 4: Insurance Market and Environment | - Types of insurance products and services - Key participants and their roles (insurers, brokers, intermediaries) - Structure of the UK insurance market |
| Topic 5: Insurance Regulation and Compliance | - Conduct of business rules and consumer protection - Ethics and professional standards - Regulatory framework in the UK (FCA and PRA) |
1. A Terms of Business Agreement between an insurer and an intermediary will normally state that the insurer will deal with the policyholder
A) via the intermediary.
B) outside normal business hours,
C) on a direct basis,
D) only when collecting premiums.
2. The purpose of the EU solvency requirements for insurers and intermediaries is to
A) introduce monitoring procedures by the Prudential Regulation Authority.
B) create a standard format for the presentation of accounting data.
C) provide authorisation to transact insurance business.
D) strengthen the financial security of the insurer or intermediary.
3. 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) Within 18 months of employment.
B) When the employee first has contact with members of the public.
C) From the initial interview.
D) It would not apply, as the employee is already fully competent.
4. 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) A pro rata amount.
C) None of the premium.
D) The full year's premium.
5. 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) Two fifths.
B) Three fifths.
C) Three eighths.
D) Five eighths.
Solutions:
| Question # 1 Answer: A | Question # 2 Answer: B | Question # 3 Answer: B | Question # 4 Answer: A | Question # 5 Answer: D |
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