The CII Financial Assess training package tests your knowledge of key financial topics
Which of the following is identified by the FCA as a main driver of customer vulnerability?
How is a scam through an ‘international SIPP’ likely to be perpetrated?
A. The scheme claims to liberate pension funds before age 55
B. The scheme is not registered in the UK
C. The scheme is UK-registered and promotes inappropriate overseas investments
D. The scheme looks like a QROPS but is not recognised by HMRC
Which of the following is a monitoring and governance requirement under the Consumer Duty?
A. Monitor and regularly review the outcomes customers are experiencing
B. Monitor and regularly review sales and cancellations
C. Monitor and regularly review profit
D. Monitor and regularly review losses
How many Cross-Cutting Rules are part of the Consumer Duty?
A maturity claim may apply on what type of life insurance policy?
A. Critical illness insurance
B. Term insurance
C. Whole of life
Why might interest rates be a factor when an insurer prices a whole of life insurance policy?
A. High interest rates lead to higher administrative costs
B. Claims tend to rise if interest rates are rising
C. Insurers rely on receiving interest on their investments to help them meet future liabilities
D. People are less inclined to want life insurance if interest rates are low
Investment shortfall is the risk that an investment return will not:
A. At least match overall market performance
B. At least match the amount of the original investment, allowing for inflation
C. Represent a net profit
D. Achieve the investment goal
What is the average figure released with new lump sum lifetime mortgages?
How is the refund of personal contributions from an occupational defined benefit pension scheme taxed for a basic rate taxpayer?
A. Tax is deducted at 50% on all of the contributions
B. Tax is deducted at 20% on the first £20,000 and 50% on the balance
C. Tax is deducted at 20% on all of the contributions
D. Tax is deducted at 20% on the first £10,000 and 50% on the balance
A client has been asked to pay an additional fee to their lender to secure a 92% loan to value mortgage. What must this fee be called?
A. Higher lending charge
B. Mortgage guarantee premium
C. Procurement fee
D. Top-up fee
1A The FCA lists four key drivers of vulnerability: health, life events, resilience and capability.
2C A scam through an international self invested pension plan (SIPP) is likely to involve inappropriate overseas investments, with the scheme itself looking legitimate, which makes prevention particularly difficult when there may well be a statutory right to transfer.
3A The Consumer Duty rules require firms to monitor and regularly review the outcomes their customers are experiencing.
4C The Consumer Duty is made up of one new Consumer Principle, three Cross-Cutting Rules and four Outcomes.
5D When an endowment policy matures, it becomes the subject of a maturity claim.
6C Sustained low interest rates may mean prices have to rise to compensate for lower investment returns.
7D Shortfall risk means that the required funds will not be generated.
8B £133,770 is the average amount borrowed for new lump sum lifetime mortgages, with lending having risen by 40% since 2021.
9B Tax is deducted at 20% on the first £20,000 and 50% on the balance, regardless of the individual's personal tax rate.
10A This must be referred to as a higher lending charge.