IF1 by CII Valid Free Exam Practice Test

Question 1

The Financial Ombudsman Service will make a ruling on a dispute between

A. a private individual and an insurer. B. an insurance broker and an insurer. C. a third party and the insurer against whom he is making a liability claim. D. an insurer and a reinsurer.

Correct Answer: A

Question 2

If an insured signs an agreement with a hold harmless clause, this may prevent the insurer from

A. pursuing subrogation rights. B. reinsuring the risk. C. disclosing details to a third party. D. increasing the premium.

Correct Answer: A

Question 3

Under the regulator's training and competency rules, a general insurance employee carrying out a non-WiFID business activity

A. indefinitely. B. for 20 years after the employee stops carrying out the activity. C. for 10 years after the employee stops carrying out the activity. D. for 3 years after the employee stops carrying out the activity.

Correct Answer: D

Question 4

When completing a proposal form, Tom declares that he has two spent speeding convictions. How, if at all, will the spent convictions affect an underwriter's decision to write the risk?

A. They will be classed as relevant information and will affect the premium. B. They will not be considered as this is not an underwriting factor in motor insurance risk assessment. C. They will only be considered if Tom had a further speeding conviction in the last 12 months. D. They will be ignored in accordance with the provisions of the Rehabilitation of Offenders Act 1974.

Correct Answer: D

Question 5

What type of risk is a widespread natural disaster?

A. A fundamental risk. B. A pure risk. C. A speculative risk. D. A particular risk.

Correct Answer: A

Question 6

Under the Consumer Rights Act 2015. a clause in a household insurance policy may be considered unfair if it

A. allows any party other than the insured to enforce the insurer's obligations under the policy. B. imposes unreasonable obligations on the insurer in terms of costs or expenses that must be paid in addition to the amount of any loss. C. discriminates against one of the persons insured on the grounds of nationality, gender or sexual orientation only. D. causes a significant imbalance in the parties' rights and obligations arising under the contract, to the disadvantage of the insured.

Correct Answer: D

Question 7

What legally recognised financial relationship must exist, between a policyholder and the items being insured, to constitute a valid household contents insurance policy?

A. Insurable interest. B. Risk indemnity. C. Vicarious liability. D. Delegated authority.

Correct Answer: A

Question 8

John and his wife arrange a household contents insurance policy in joint names with insurer A for a sum insured of £10,000. His wife arranges a second policy on the same basis with insurer B for a sum insured of
£20,000. Both policies have identical terms and conditions. What is insurer A's liability if a valid claim of
£3,000 is subsequently made?

A. £1,000 B. £3,000 C. £2,000 D. £1,500

Correct Answer: A

Question 9

What is the basis of settlement under a new for old insurance policy if a television is stolen?

A. The replacement cost, less wear and tear. B. The replacement cost in full. C. The original cost in full. D. The original cost, less wear and tear.

Correct Answer: A

Question 10

Alex decides to insure his factory. In doing this he is primarily

A. protecting his business against certainty of loss. B. reducing his moral hazard. C. transferring the risk to the insurer. D. reducing his physical hazard.

Correct Answer: C

CII Insurance Legal and Regulatory (IF1) - IF1 Exam Practice Test