Friday Five Focus on Protection – 5 Questions in 5 Minutes – 26 Jun 2026

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 2025/26, examinable by the CII until 31 August 2026. They do not relate to tax year 2026/27 which is only examinable by the CII from 1 September 2026.

1. Tom is receiving benefits from his employer’s group income protection scheme. How will these be treated in relation to his personal tax liability?
   1. The benefits will be free of tax if Tom has been a member of the scheme for more than 2 years before receiving the benefits.
   2. Any benefits will be completely free of any liability for tax.
   3. They will be taxed in the same way as normal pay.
   4. The benefits will only be taxed if Tom is still receiving them after 12 months.

2. Doreen, resident in England, has savings and investments of £20,000. How much tariff income will her local authority deem her to have?
   1. £11.50 per week.
   2. £15.00 per week.
   3. £23.00 per week.
   4. £80.00 per week.

3. In quantifying the protection needs of a client on death, the first consideration should be
   1. Capital to make lifestyle changes.
   2. Income for dependants in the long term.
   3. Capital to settle liabilities.
   4. Income for dependants in the short term.

4. Jamil, a financial adviser, is in the process of establishing the state benefits which may be available to some of his clients. He should be aware that which benefit is not means tested?
   1. Income support.
   2. Universal credit.
   3. Attendance Allowance.
   4. Housing benefit.

5. The shortfall in the amount of cover necessary to maintain the current living standards of dependants can also be referred to as the
   1. savings gap.
   2. pensions cap.
   3. investment gap.
   4. protection gap.

Answers

1. C; See R05 Study Text, Chp 6; Rationale: Benefits from a group income protection scheme are paid out under PAYE, meaning that income tax and National Insurance contributions are deducted in the same way as for normal pay.
2. C; See R05 Study Text, Chp 8; Rationale: £20,000 is in excess of the lower threshold (£14,250 in England), so each £250 of assets over the threshold is assessed as giving £1 a week of tariff income. £20,000 – £14,250 = £5,750 / £250 = £23.
3. C; See R05 Study Text, Chp 10; Rationale: The provision of a lump sum to pay off debts that will become due in full on death should be the first consideration.
4. C; See R05 Study Text, Chp 3; Rationale: Attendance allowance is not means tested. It is also not taxed or subject to a claimant’s national insurance contributions.
5. D; See R05 Study Text, Chp 1; Rationale: The ‘protection gap’ is the term given to the shortfall in the amount of cover necessary to maintain the current living standards of financial dependants.

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