Friday Five Focus on Protection – 31 March – 5 Questions in 5 Minutes
Friday Five Focus on Protection – 5 Questions in 5 Minutes Every Friday
What’s this all about?
Each week, we ask questions relating to one of these topics: Investments, Taxation, Pensions, Protection, or Regulation. This week, our Friday Five is relevant to Protection; this is useful as you prepare for the CII’s R05 exam. 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 2022/23, examinable by the CII until 31 August 2023.
- Income Protection is likely to be a higher priority than Critical Illness cover for most people because
- it has a shorter deferred period
- income protection policies allow higher sums assured
- an income protection plan covers significantly more medical conditions
- the plan pays the benefits tax free
- Avril wants a low-cost policy that will help to pay for any medical care she requires. A disadvantage of a basic private medical insurance plan rather than a comprehensive policy is
- the cost of drugs required in treatment is not covered
- treatment relating to substance abuse is unlikely to be covered
- normal pregnancy will not be covered
- there may be fairly low limits on the cost of treatment covered in one year
- In which of the following situations can policy splitting on divorce be beneficial?
- Where one of the divorcees is significantly older than the other
- When the health of one has deteriorated since the policy was taken out
- Where the income of one of the divorcees is significantly lower than the others
- When the terms of a new policy would be more beneficial than the existing policy
- Philip and Gary hold property as tenants in common. On Philip’s death, his share is passed to his sister. In relation to its inheritance tax treatment, it will be
- liable for inheritance tax at 20%
- exempt from inheritance tax
- liable for inheritance tax on a reducing scale
- potentially liable for inheritance tax at 40%
- Anne wants an income protection policy which includes an element of protection against inflation. Which of the following options may be available?
- An amount of increase chosen by the insurer every five years
- A rise in benefits selected by her every year
- An automatic increase at stated periods without further underwriting
- An automatic elevation of benefits based on the occurrence of stated life events
Answers
- C – See R05 Study Text, Chp 7
Grab our taster mock exam paper for CII R05. Click here to download.
- D – See R05 Study Text, Chp 9
Grab our taster mock exam paper for CII R05. Click here to download.
- B – See R05 Study Text, Chp 2
Grab our taster mock exam paper for CII R05. Click here to download.
- D – See R05 Study Text, Chp 5
Grab our taster mock exam paper for CII R05 Click here to download.
- C – See R05 Study Text, Chp 6
Grab our taster mock exam paper for CII R05. 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?
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