Friday Five – 30 August – 5 Questions in 5 Minutes

Welcome to this week’s Friday Five – 5 Questions in 5 Minutes Every Friday

What’s this all about?

It’s a bit of Friday Fun where we provide you with 5 questions relevant to a mix of CII exams. The challenge is for you to answer them in 5 minutes. Answers at the bottom of the page.

Questions

IMPORTANT!  These questions relate to examinable tax year 2018/19, examinable by the CII until 31 August 2019.  They do not relate to tax year 2019/20 which is only examinable by the CII from 1 September 2019.

1. If a provider gives any benefits or inducements to an intermediary how long must they keep records for?
   1. 7 years
   2. 6 years
   3. 5 years
   4. 3 years

2. If a bond’s redemption yield is higher than its interest yield, what does this indicate?
   1. The bond has just made an interest payment
   2. There will be a capital gain if held till maturity
   3. The issuer has a strong credit rating
   4. The bond’s proceeds will be tax-free

3. Maxine is considering whether to invest in Friendly Society policies for each of her 3 children and has asked you to supply some information. You tell her that: Tick all that apply.
   1. The maximum monthly premium is £25
   2. Premiums can only be paid monthly
   3. The funds are free of UK tax on income and gains
   4. She can only have one policy per family

4. Alan used his £300,000 pension fund to buy a pension protected annuity. The annuity was £18,000 pa payable annually in arrears. Alan died aged 72, having received 12 payments to that point. The annuity protection lump sum his dependants would receive is:
   1. £54,600.
   2. £84,000.
   3. £37,800.
   4. £126,900.

5. Carol and Steven have successfully applied for a closed bridging loan. This is most likely to be because:
   1. they have found a buyer for their own home and accepted their offer
   2. they have not put their own home on the market yet
   3. they have exchanged contracts on the sale of their existing property
   4. they have 20% equity in their existing property

Answers

1. C – See R01 Study Text, Chp 5:2
   Grab our taster mock exam paper for CII R01. Click here to download.

2. B – See R02 Study Text, Chp 1:1
   Grab our taster mock exam paper for CII R02. Click here to download.

3. AC – See R03 Study Text, Chp 10
   Grab our taster mock exam paper for CII R03. Click here to download.

4. B – See R04 Study Text, Chp 6:1
   Grab our taster mock exam paper for CII R04. Click here to download.

5. C – See R07 Study Text, Chp 6
   Grab our taster mock exam paper for CII R07. Click here to download.

How did you find this week’s questions? Did you complete them in 5 minutes? Did you get them all correct? Do you disagree with any?

If you found this quiz useful for your CII exam revision, please do share it with your colleagues.