Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Cert CII - LM1 > 6 - Legal and Regulatory Environment > Flashcards

6 - Legal and Regulatory Environment Flashcards

1
Q

What three bodies make up the UK regulatory framework for financial services?

A

FCA (Financial Conduct Authority)
PRA (Prudential Regulatory Authority)
FPC (Financial Policy Committee)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is the primary objective of the PRA?

A

Promote safety and soundness of regulated persons, responsible for solvency and stability

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What determines the PRA’s intensity of supervision?

A

The perceived level of risk

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What are the three operational objectives of the FCA?

A

Consumer Protection
Integrity
Competition

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What makes the FCA more proactive than previous regulators?

A

Intervenes earlier in a products life and seeks to address the root cause of problems

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What is a ‘fixed portfolio’ firm?

A

A small proportion of firms which require the highest level of supervision, determined by size and market presence

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What are ‘flexible portfolio’ firms?

A

The majority of firms which are more passively regulated

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What can the FCA do if it finds problems?

A
  1. Ban products
  2. Withdraw misleading promotions
  3. Fine or prosecute individuals
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Who does the FCA report to?

A

Government and parliament, annually

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

The eleven principles for business (PRIN) can be found in which documents?

A

FCA handbook and PRA rulebook

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is SYSC?

A

Senior management arrangements, systems and controls

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is PIDA?

A

The public interest disclosure act 1998

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What does PIDA do?

A

Concerns whistleblowing - makes it unlawful for an employer to punish an employee for disclosing information

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is the difference between working on an establishment basis or services basis?

A

Establishment - open offices in EU
Services - work only from home state

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is working on an ‘admitted basis’ in regards to US insurance?

A

State regulators granting permission to foreign insurance companies to write business

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is the incentive for nations to regulate foreign insurers?

A

To keep local risks written in local markets, hence retaining premium within its own economy

17
Q

If a worker notices it’s employer committing for example a criminal offence, miscarriage of justice or concealment, it carries out a what?

A

Criminal disclosure

18
Q

When the local market cannot accept all the risk, Lloyds can step in from abroad. This is known as what?

A

Surplus lines status

19
Q

What is the key difference between Lloyds and company markets obtaining permission to write business overseas?

A

Lloyds obtains the permission centrally for all syndicates, whereas companies have to get individual permission

20
Q

What compliance acts are managing agents required to carry out?

A
  1. File annual solvency test return
  2. Assess the capital required to engage in insurance busines
  3. Maintain controls over risks
21
Q

What is the key concept that underpins the regulator’s willingness to allow Lloyds a degree of self regulation?

A

Insureds must have same protection as if insured by Non-Lloyds insurer

22
Q

Which key bodies oversee the Lloyds acts?

A

Council of Lloyd’s
Executive comittee

23
Q

What two forms do laws take in Lloyds?

A
  1. Bye laws and regulations
  2. Requirements
24
Q

What is capital adequacy?

A

Required for new insurers, it is the amount by which assets must exceed liabilities

25
Q

What must insurers submit annually to the regulator?

A
  1. Revenue account
  2. Profit and loss account
  3. Balance sheet
26
Q

What is ‘run off’?

A

When an insurer is prevented from taking any further business by a regulator

27
Q

Who deals with financial disputes between individual consumers or small businesses and financial institutions?

A

Financial ombudsman service (FOS)

28
Q

How long does a complainant have to report to FOS?

A

After exhausting internal complaints, six months

29
Q

How large can a company be before the FOS can no longer assist them?

A
  1. Turnover less than £6.5m
  2. Less than 50 employees
  3. Balance sheet total less than £5m
30
Q

What is the role of the FSCS?

A

Covering claims against firms who are unable to pay

31
Q

What insurance does the FSCS. not cover?

A

Goods in transit, marine, aviation and credit

32
Q

What is the central fund?

A

Lloyds reserve fund which pays claims if insurers cannot.

33
Q

All authorised insurance company pay must report complaints to the FCA in what frequency?

A

Bi-annually

34
Q

How much of a non-compulsory insurance policy claim will the FSCS pay out?

A

90%

Cert CII - LM1 (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions