Question 1

The purpose of the EU solvency requirements for insurers and intermediaries is to

Options :

A : create a standard format for the presentation of accounting data.

B : introduce monitoring procedures by the Prudential Regulation Authority.

C : provide authorisation to transact insurance business.

D : strengthen the financial security of the insurer or intermediary.

Answer: A

Question 2

Who cedes business to a reinsurer?

Options :

A : The insurer.

B : The assessor.

C : The agent.

D : The insured.

Answer: A

Question 3

Reinsurance is usually purchased by the

Options :

A : intermediary.

B : insurer.

C : regulator.

D : insured.

Answer: B

Question 4

Joel buys a house in a flood plain, but it has NOT flooded for 10 years. In purchasing insurance, Joel is managing what element of risk?

Options :

A : Uncertainty.

B : Statutory requirements.

C : Frequency.

D : Certainty.

Answer: A

Question 5

The website of an insurer must include the company's registered name, trading address, contact details and regulator. This is in accordance with rules enforced by the

Options :

A : Advertising Standards Authority.

B : Competition and Markets Authority.

C : Prudential Regulation Authority.

D : Financial Ombudsman Service.

Answer: D

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