IF1

Question 1

A risk where there is possibility of a loss but not a gain

Answer 1

Pure Risk

Question 2

A risk where there is chance of a gain

Answer 2

Speculative Risk

Question 3

A risk that is localised or personal in its cause and effect

Answer 3

Particular Risk

Question 4

A risk that occurs on such a vast scale that it is uninsurable

Answer 4

Fundamental Risk

Question 5

An event that is accidental or unexpected and not inevitable

Answer 5

Fortuitous Event

Question 6

That with gives rise to a loss

Answer 6

Peril

Question 7

That which influences the operation or effect of the peril

Answer 7

Hazard

Question 8

Each person’s side of the margin which supports the contract

Answer 8

Consideration

Question 9

Acceptance of an offer which does not alter any of the terms of the original offer

Answer 9

Unconditional Acceptance

Question 10

Acceptance of an offer where new terms are introduced, forming a counteroffer

Answer 10

Conditional Acceptance

Question 11

The legal right to Insure arising out of a financial relationship recognised at law between the Insured and the subject-matter of Insurance

Answer 11

Insurable Interest

Question 12

A legal term used for a bar or impediment that precludes a person from asserting a fact or a right arising when one party’s conduct has been relied upon by the other

Answer 12

Estoppel

Question 13

The contract has been fully performed

Answer 13

Fulfilment

Question 14

The dominant cause of a loss where there is a direct link between it and resulting loss

Answer 14

Proximate Cause

Question 15

Financial compensation sufficient to place the Insured in the same financial position after a loss as they enjoyed immediately before the loss occurred

Answer 15

Indemnity

Question 16

Non-indemnity policies that provide fixed benefits, mainly for sickness and accident

Answer 16

Benefit Policies

Question 17

The policy term applied when there has been underinsurance

Answer 17

Average

Question 18

A policy where the value of the subject-matter of Insurance is agreed at the start of the contract and the sum insured is fixed accordingly

Answer 18

Agreed Value Policy

Question 19

A policy where the full value of the insured property is not at risk

Answer 19

First Loss Policy

Question 20

An Insurer accepts an unknown future potential risk for an agreed premium

Answer 20

Risk Transfer Mechanism

Question 21

The right of an Insurer to call upon others liable to the same insured to share the cost of an indemnity payment

Answer 21

Contribution

Question 22

The right to stand in the place of another and avail all the rights and remedies of that other

Answer 22

Subrogation

Question 23

The original insurer who is passing the risk to reinsurers

Answer 23

Cedant

Question 24

The process whereby Insurers share a risk with other Insurers or with their own Insured

Answer 24

Co-Insurance

Question 25

When two or more policies are in force which cover the same risk

Answer 25

Dual Insurance

Question 26

A reinsurer obtaining reinsurance for itself

Answer 26

Retrocedant

Question 27

Groups of private individuals or corporate investors who carry the risks

Answer 27

Syndicates

Question 28

Companies where shareholders have limited liability

Answer 28

Proprietary Companies

Question 29

An entity that is employed by a syndicate to appoint underwriters to write the risks and manage the day-to-day running of the syndicate

Answer 29

Managing Agents

Question 30

The wider market that transacts insurance business in the London Market but outside of Lloyd's

Answer 30

Company Market

Question 31

An entity that ring-fences the assets of participating cells in a group to allow them to operate as distinct insurance entities

Answer 31

Protected Cell Company

Question 32

Companies owned by their Policyholders

Answer 32

Mutual Companies

Question 33

Insurance Companies who are solely insuring risks from parent/sister companies in the same group

Answer 33

Captives

Question 34

Companies that accept a wide range of classes of business

Answer 34

Composite Company

Question 35

The complete and final agreement of all terms between the Insured and the Insurer by the time that they enter into the contract

Answer 35

Contract Certainty

Question 36

A non-traditional form of insurance that is compliant with the rulings of Sharia Law

Answer 36

Takaful Insurance

Question 37

A specialist type of intermediary who has delegated authority to act for one or more Insurers

Answer 37

Managing General Agent

Question 38

A requirement that companies have a solvency margin where assets must exceed liabilities

Answer 38

Capital Adequacy

Question 39

A representative that is limited to distributing 'non-real time financial promotions' such as brochures

Answer 39

Introducer Appointed Representative (IAR)

Question 40

An agreement outlining the contractual relationship between an Insurer and an intermediary

Answer 40

Terms of Business Agreement (TOBA)

Question 41

Where a Third Party is not in a position to make a judgement about the extent of an agents authority

Answer 41

Apparent (Ostensible) Authority

Question 42

An individual or a company that is appointed by an authorised person under the terms of the contract

Answer 42

Appointed Representatives

Question 43

An intermediary that has been directly authorised by the FCA to provide independent advice

Answer 43

Authorised Persons

Question 44

A broking firm can acquire access to centralised services and benefit from a formal alliance with other brokers

Answer 44

Broker Network

Question 45

Companies that grow through formal acquisition of others within the marketplace

Answer 45

Consolidator

Question 46

An arrangement between a bank and insurance company whereby insurance products are sold to the bank's existing customers

Answer 46

Bancassurance

Question 47

An act containing the law on disclosure and representations for non-consumer insureds

Answer 47

Insurance Act 2015

Question 48

An act containing the law on disclosure and representations for consumers

Answer 48

Consumers (Disclosure and Representations) Act 2012

Question 49

An act introducing a remedy for insureds who believe their claims have been paid late

Answer 49

Enterprise Act 2016

Question 50

The extent of an agent's authority - This can be expressed or implied

Answer 50

Actual Authority