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Question 1 of 30
1. Question
According to the Motor Vehicles (Third-Party Risks and Compensation) Act (Chapter 189) and related rules, what crucial role does the Certificate of Insurance play in demonstrating legal compliance for motor insurance policies?
Correct
The Motor Vehicles (Third-Party Risks and Compensation) Act (Chapter 189) and its related rules mandate that motor insurance policies must comply with specific provisions. The Certificate of Insurance serves as proof that the policy adheres to these legal requirements. It includes a certification wording signed by an authorized officer of the insurer, confirming compliance with the Act and its associated rules. This ensures that the insurance policy meets the minimum legal standards for third-party risks and compensation as required by Singaporean law.
Incorrect
The Motor Vehicles (Third-Party Risks and Compensation) Act (Chapter 189) and its related rules mandate that motor insurance policies must comply with specific provisions. The Certificate of Insurance serves as proof that the policy adheres to these legal requirements. It includes a certification wording signed by an authorized officer of the insurer, confirming compliance with the Act and its associated rules. This ensures that the insurance policy meets the minimum legal standards for third-party risks and compensation as required by Singaporean law.
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Question 2 of 30
2. Question
Mr. Tan purchased a travel insurance policy for a trip to Europe. He has a pre-existing heart condition that was stable and well-managed with medication. Two days before his trip, his doctor advised him not to travel due to concerns about a potential flare-up of his condition. Can Mr. Tan claim for trip cancellation under his travel insurance policy?
Correct
Travel insurance policies are designed to cover unforeseen events that disrupt travel plans. Cancelling a trip due to a pre-existing medical condition that was stable and known before purchasing the insurance typically falls outside the scope of coverage. Travel insurance is intended to protect against new, unexpected events, not chronic or pre-existing conditions that could reasonably be anticipated to cause issues. While some policies may offer riders or specific coverage for pre-existing conditions, the standard policy usually excludes such scenarios to manage risk and keep premiums affordable. Therefore, the insured person would not be able to claim for the trip cancellation.
Incorrect
Travel insurance policies are designed to cover unforeseen events that disrupt travel plans. Cancelling a trip due to a pre-existing medical condition that was stable and known before purchasing the insurance typically falls outside the scope of coverage. Travel insurance is intended to protect against new, unexpected events, not chronic or pre-existing conditions that could reasonably be anticipated to cause issues. While some policies may offer riders or specific coverage for pre-existing conditions, the standard policy usually excludes such scenarios to manage risk and keep premiums affordable. Therefore, the insured person would not be able to claim for the trip cancellation.
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Question 3 of 30
3. Question
Under a Personal Accident Insurance policy, an insured individual changes their occupation from a desk-bound office administrator to a construction site supervisor. According to standard policy conditions, what is the insured primarily required to do, and why is this action necessary?
Correct
According to the policy conditions typically found in Personal Accident Insurance, the insured is obligated to notify the insurer of any changes in their occupation. This is crucial because the premium is largely determined by the nature of the insured’s occupation, reflecting the associated risks. Notification allows the insurer to re-evaluate the risk, adjust the premium if necessary, and decide whether to continue the insurance under the revised circumstances. Failing to report such changes could affect the validity of future claims, as the risk profile initially assessed no longer accurately represents the insured’s situation. The other options are incorrect because while reporting changes in health and habits is important, the primary trigger for re-underwriting is a change in occupation. Claim procedures and policy cancellation are separate conditions that do not directly relate to the necessity of reporting occupational changes.
Incorrect
According to the policy conditions typically found in Personal Accident Insurance, the insured is obligated to notify the insurer of any changes in their occupation. This is crucial because the premium is largely determined by the nature of the insured’s occupation, reflecting the associated risks. Notification allows the insurer to re-evaluate the risk, adjust the premium if necessary, and decide whether to continue the insurance under the revised circumstances. Failing to report such changes could affect the validity of future claims, as the risk profile initially assessed no longer accurately represents the insured’s situation. The other options are incorrect because while reporting changes in health and habits is important, the primary trigger for re-underwriting is a change in occupation. Claim procedures and policy cancellation are separate conditions that do not directly relate to the necessity of reporting occupational changes.
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Question 4 of 30
4. Question
Under the General Conditions of a Personal General Insurance policy in Singapore, what is the timeframe within which an insured must provide written notice to the insurance company regarding an accident that may give rise to a claim?
Correct
According to the General Conditions of a Personal General Insurance policy, specifically condition number 5, the insured is required to provide written notice to the company within twenty-one (21) days of any accident that may lead to a claim. This notice should detail the circumstances of the loss, damage, liability, death, injury, or illness. Additionally, the insured must furnish all certificates, information, and evidence required by the company at their own expense. The insured must also provide authorization for the company, its representatives, and medical advisors to access medical records related to the claim event. Failing to adhere to this procedure may affect the claim’s validity.
Incorrect
According to the General Conditions of a Personal General Insurance policy, specifically condition number 5, the insured is required to provide written notice to the company within twenty-one (21) days of any accident that may lead to a claim. This notice should detail the circumstances of the loss, damage, liability, death, injury, or illness. Additionally, the insured must furnish all certificates, information, and evidence required by the company at their own expense. The insured must also provide authorization for the company, its representatives, and medical advisors to access medical records related to the claim event. Failing to adhere to this procedure may affect the claim’s validity.
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Question 5 of 30
5. Question
Mr. Tan’s golf clubs were damaged during a flight to a golfing tournament. As a result, he had to rent a set of clubs for the duration of the tournament. Which extension of his golfer’s insurance policy would potentially cover the cost of renting the replacement clubs?
Correct
According to the syllabus, Golfing Equipment Hire coverage in a golfer’s insurance policy typically reimburses the insured for the cost of hiring replacement golfing equipment if their own equipment is lost or damaged, as covered under the policy. The reimbursement is usually subject to a specified limit. The scenario describes a situation where the insured’s clubs are damaged, necessitating the hire of replacement clubs. Therefore, the Golfing Equipment Hire extension would be applicable, up to the policy’s limit. Hole-in-one coverage applies to hospitality costs incurred after achieving a hole-in-one. Club subscription fees reimbursement applies when the insured is unable to play golf due to injury or illness, subject to a time excess. Breakage of clubs covers accidental breakage of clubs during play or practice, but not the cost of hiring replacements.
Incorrect
According to the syllabus, Golfing Equipment Hire coverage in a golfer’s insurance policy typically reimburses the insured for the cost of hiring replacement golfing equipment if their own equipment is lost or damaged, as covered under the policy. The reimbursement is usually subject to a specified limit. The scenario describes a situation where the insured’s clubs are damaged, necessitating the hire of replacement clubs. Therefore, the Golfing Equipment Hire extension would be applicable, up to the policy’s limit. Hole-in-one coverage applies to hospitality costs incurred after achieving a hole-in-one. Club subscription fees reimbursement applies when the insured is unable to play golf due to injury or illness, subject to a time excess. Breakage of clubs covers accidental breakage of clubs during play or practice, but not the cost of hiring replacements.
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Question 6 of 30
6. Question
Under the standard “Payment before Cover Warranty” in a Singaporean private motor insurance policy, what is the consequence if the total premium due is not received by the insurer on or before the policy’s inception date?
Correct
According to the “Payment before Cover Warranty” clause, the insurance coverage only attaches when the total premium due is fully paid and received by the insurer (or the intermediary) on or before the inception or renewal date. If the premium is not paid in full by this date, the insurance does not take effect, and no benefits are payable. Subsequent payments are considered ineffective as coverage has not been initiated. This condition is crucial for the validity of the insurance policy.
Incorrect
According to the “Payment before Cover Warranty” clause, the insurance coverage only attaches when the total premium due is fully paid and received by the insurer (or the intermediary) on or before the inception or renewal date. If the premium is not paid in full by this date, the insurance does not take effect, and no benefits are payable. Subsequent payments are considered ineffective as coverage has not been initiated. This condition is crucial for the validity of the insurance policy.
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Question 7 of 30
7. Question
Mr. Tan’s insured dwelling becomes uninhabitable due to a fire. His personal general insurance policy includes an extension for ‘Loss of Rent and Additional Expense of Alternative Accommodation,’ covering up to S$10,000 per month or an aggregate limit of 10% of the total sum insured for Sections 1 and 2 or S$50,000, whichever is lower. If the total sum insured for Sections 1 and 2 is S$600,000, what is the maximum amount payable under this extension?
Correct
The ‘Loss of Rent and Additional Expense of Alternative Accommodation’ extension in a personal general insurance policy provides coverage when the insured dwelling becomes uninhabitable due to an insured peril. The policy will indemnify the insured for reasonable additional expenses for alternative accommodation and/or loss of rent payable to the insured, actually incurred during the period necessary for the reinstatement of the insured dwelling. The maximum coverage is typically capped at a certain amount per month or a percentage of the total sum insured for Sections 1 and 2, whichever is lower. In this case, the policy covers up to S$10,000 per month, with an aggregate limit of 10% of the total sum insured for Sections 1 and 2 or S$50,000, whichever is lower. Therefore, the maximum amount payable under this extension is S$50,000.
Incorrect
The ‘Loss of Rent and Additional Expense of Alternative Accommodation’ extension in a personal general insurance policy provides coverage when the insured dwelling becomes uninhabitable due to an insured peril. The policy will indemnify the insured for reasonable additional expenses for alternative accommodation and/or loss of rent payable to the insured, actually incurred during the period necessary for the reinstatement of the insured dwelling. The maximum coverage is typically capped at a certain amount per month or a percentage of the total sum insured for Sections 1 and 2, whichever is lower. In this case, the policy covers up to S$10,000 per month, with an aggregate limit of 10% of the total sum insured for Sections 1 and 2 or S$50,000, whichever is lower. Therefore, the maximum amount payable under this extension is S$50,000.
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Question 8 of 30
8. Question
Freddy has a Hospital Cash Insurance policy that pays S$100 per day of hospitalisation, up to 180 days per hospitalisation and a lifetime limit of 1,000 days. According to the policy illustrated in Example 6.1, how many days will the insurer pay Freddy for his hospital stays in 2003 and 2015, respectively, considering the policy’s limitations?
Correct
Hospital Cash Insurance provides a fixed daily benefit for each day of hospitalisation, up to a specified limit per hospitalisation and a lifetime limit. Freddy’s policy pays S$100 per day, up to 180 days per hospitalisation and 1,000 days lifetime. In 2003, Freddy was hospitalised for 210 days, but the policy only pays up to 180 days per hospitalisation. In 2015, Freddy’s remaining lifetime limit was 140 days, so the policy only paid for 140 days despite his 160-day stay. Therefore, the insurer paid Freddy for 180 days in 2003 and 140 days in 2015.
Incorrect
Hospital Cash Insurance provides a fixed daily benefit for each day of hospitalisation, up to a specified limit per hospitalisation and a lifetime limit. Freddy’s policy pays S$100 per day, up to 180 days per hospitalisation and 1,000 days lifetime. In 2003, Freddy was hospitalised for 210 days, but the policy only pays up to 180 days per hospitalisation. In 2015, Freddy’s remaining lifetime limit was 140 days, so the policy only paid for 140 days despite his 160-day stay. Therefore, the insurer paid Freddy for 180 days in 2003 and 140 days in 2015.
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Question 9 of 30
9. Question
In a Packaged Household Insurance proposal form, which section is MOST critical in establishing the proposer’s agreement to the terms and conditions and confirming the accuracy of the information provided, thus forming the basis of the insurance contract under the Insurance Act?
Correct
The declaration section of a proposal form is crucial as it signifies the proposer’s agreement to the terms and conditions, and confirms the accuracy of the information provided. This declaration forms the basis of the insurance contract, making the proposer responsible for the truthfulness and completeness of the details shared. Omitting this step would render the proposal incomplete and potentially void, as it lacks the proposer’s formal acknowledgment and acceptance of the contract’s terms. Payment instructions, while necessary for processing, do not validate the accuracy of the provided information. Details of insurance cover specify the extent of coverage desired but do not confirm the proposer’s agreement to the contract’s terms. The location of risk is important for assessing the risk profile but does not serve as a formal declaration of the proposer’s adherence to the contract’s terms.
Incorrect
The declaration section of a proposal form is crucial as it signifies the proposer’s agreement to the terms and conditions, and confirms the accuracy of the information provided. This declaration forms the basis of the insurance contract, making the proposer responsible for the truthfulness and completeness of the details shared. Omitting this step would render the proposal incomplete and potentially void, as it lacks the proposer’s formal acknowledgment and acceptance of the contract’s terms. Payment instructions, while necessary for processing, do not validate the accuracy of the provided information. Details of insurance cover specify the extent of coverage desired but do not confirm the proposer’s agreement to the contract’s terms. The location of risk is important for assessing the risk profile but does not serve as a formal declaration of the proposer’s adherence to the contract’s terms.
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Question 10 of 30
10. Question
Under what circumstance would a claim for veterinary fees under the Enhanced Pet Dog Extension be rejected, according to the policy document, assuming all other conditions are met and the claim falls within the coverage limits?
Correct
The Agri-food & Veterinary Authority of Singapore (now Singapore Food Agency) registration is a prerequisite for pet dog insurance coverage. If the pet is not registered, the insurance company is not liable for claims. This exclusion is explicitly stated in the policy conditions to ensure responsible pet ownership and compliance with local regulations. The other options do not align with the specific exclusions listed in the provided policy document.
Incorrect
The Agri-food & Veterinary Authority of Singapore (now Singapore Food Agency) registration is a prerequisite for pet dog insurance coverage. If the pet is not registered, the insurance company is not liable for claims. This exclusion is explicitly stated in the policy conditions to ensure responsible pet ownership and compliance with local regulations. The other options do not align with the specific exclusions listed in the provided policy document.
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Question 11 of 30
11. Question
A policyholder uses their private motor car, insured under a personal general insurance policy, to deliver goods for their new online business without informing the insurer. Additionally, during one of these deliveries, the policyholder’s son, who holds a valid Class 3C driving license (allowing him to drive automatic transmission vehicles only), drives the insured manual transmission vehicle and causes an accident. According to the general exclusions of the policy and the Road Traffic Act (Cap. 276), which of the following statements is most accurate regarding the insurer’s liability?
Correct
The ‘Limitations As To Use’ clause in a motor insurance policy restricts the usage of the vehicle to specific purposes. Using the vehicle for purposes outside these limitations, such as commercial activities when it’s insured for private use, voids coverage. This exclusion is in place because the risk profile and associated premiums are calculated based on the declared usage. Driving without a valid license also violates the Road Traffic Act, rendering the insurance policy void due to non-compliance with legal requirements. The Road Traffic Act (Cap. 276) mandates that all drivers must possess a valid license for the class of vehicle they are operating. Failure to comply with this regulation constitutes a breach of the policy’s terms and conditions, leading to the rejection of claims arising from accidents or damages.
Incorrect
The ‘Limitations As To Use’ clause in a motor insurance policy restricts the usage of the vehicle to specific purposes. Using the vehicle for purposes outside these limitations, such as commercial activities when it’s insured for private use, voids coverage. This exclusion is in place because the risk profile and associated premiums are calculated based on the declared usage. Driving without a valid license also violates the Road Traffic Act, rendering the insurance policy void due to non-compliance with legal requirements. The Road Traffic Act (Cap. 276) mandates that all drivers must possess a valid license for the class of vehicle they are operating. Failure to comply with this regulation constitutes a breach of the policy’s terms and conditions, leading to the rejection of claims arising from accidents or damages.
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Question 12 of 30
12. Question
According to the Motor Vehicles (Third Party Risks and Compensation) Act in Singapore, which type of motor insurance coverage is legally required for all vehicle owners?
Correct
Under the Motor Vehicles (Third Party Risks and Compensation) Act, it is compulsory for all motor vehicle owners in Singapore to have motor insurance that covers third-party bodily injury or death. This ensures that if the policyholder causes an accident resulting in bodily injury or death to a third party, the insurance company will provide compensation. Damage to third-party property, while commonly included in motor insurance policies, is not mandated by this Act. Therefore, having insurance solely for damage to third-party property would not fulfill the legal requirement.
Incorrect
Under the Motor Vehicles (Third Party Risks and Compensation) Act, it is compulsory for all motor vehicle owners in Singapore to have motor insurance that covers third-party bodily injury or death. This ensures that if the policyholder causes an accident resulting in bodily injury or death to a third party, the insurance company will provide compensation. Damage to third-party property, while commonly included in motor insurance policies, is not mandated by this Act. Therefore, having insurance solely for damage to third-party property would not fulfill the legal requirement.
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Question 13 of 30
13. Question
According to the standard definitions within a critical illness policy, which of the following diagnoses would typically be excluded from coverage under the ‘Major Cancers’ definition, as it does not meet the criteria of invasive and destructive growth?
Correct
The definition of ‘Major Cancers’ in a critical illness policy explicitly excludes certain conditions to ensure that claims are paid for severe illnesses rather than relatively minor ones. Specifically, tumors histologically classified as carcinoma-in-situ are excluded because they represent cancer cells that are confined to the original location and have not invaded surrounding tissues. This exclusion is a standard practice in the insurance industry to manage risk and ensure the sustainability of critical illness policies. Therefore, a diagnosis of carcinoma-in-situ would not meet the policy’s definition of Major Cancers and would not be eligible for a claim.
Incorrect
The definition of ‘Major Cancers’ in a critical illness policy explicitly excludes certain conditions to ensure that claims are paid for severe illnesses rather than relatively minor ones. Specifically, tumors histologically classified as carcinoma-in-situ are excluded because they represent cancer cells that are confined to the original location and have not invaded surrounding tissues. This exclusion is a standard practice in the insurance industry to manage risk and ensure the sustainability of critical illness policies. Therefore, a diagnosis of carcinoma-in-situ would not meet the policy’s definition of Major Cancers and would not be eligible for a claim.
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Question 14 of 30
14. Question
A traveler purchases a travel insurance policy that includes a ‘Double Indemnity’ benefit for accidental death while riding as a fare-paying passenger in public transport. While on vacation, the traveler is fatally injured in a taxi accident. To determine if the ‘Double Indemnity’ benefit applies, what is the MOST critical factor to consider?
Correct
Travel insurance policies often include a Personal Accident benefit that provides compensation for accidental death or permanent disablement. The ‘Double Indemnity’ clause enhances this benefit by paying twice the amount if the accident occurs while the insured is a fare-paying passenger in public transport. However, the specific definition of ‘public transport’ can vary between policies. Some policies may include taxis, while others may explicitly exclude them. Therefore, it is essential to carefully review the policy’s definition of ‘public transport’ to determine whether taxi rides are covered under the Double Indemnity benefit. This is in line with the Monetary Authority of Singapore (MAS) guidelines on transparency and disclosure in insurance policies, ensuring consumers are fully aware of the terms and conditions.
Incorrect
Travel insurance policies often include a Personal Accident benefit that provides compensation for accidental death or permanent disablement. The ‘Double Indemnity’ clause enhances this benefit by paying twice the amount if the accident occurs while the insured is a fare-paying passenger in public transport. However, the specific definition of ‘public transport’ can vary between policies. Some policies may include taxis, while others may explicitly exclude them. Therefore, it is essential to carefully review the policy’s definition of ‘public transport’ to determine whether taxi rides are covered under the Double Indemnity benefit. This is in line with the Monetary Authority of Singapore (MAS) guidelines on transparency and disclosure in insurance policies, ensuring consumers are fully aware of the terms and conditions.
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Question 15 of 30
15. Question
A construction worker injures their leg in an accident and is temporarily unable to perform any physical labor, which is essential to their job. Under a personal accident insurance policy, which benefit is the worker most likely to claim?
Correct
Temporary total disablement benefits are designed to provide financial support when an insured person is temporarily unable to perform their occupational duties due to an accident. The key criterion is the inability to perform every duty of their profession. The scenario describes a situation where the insured, a construction worker, cannot perform their usual physical labor due to a leg injury, which directly impacts their ability to fulfill their occupational duties. Therefore, they are eligible for temporary total disablement benefits. Temporary partial disability applies when the insured can perform some, but not all, of their duties. Permanent total disablement requires a condition that permanently prevents the insured from working. Medical expenses cover the costs of treatment, not lost income due to inability to work.
Incorrect
Temporary total disablement benefits are designed to provide financial support when an insured person is temporarily unable to perform their occupational duties due to an accident. The key criterion is the inability to perform every duty of their profession. The scenario describes a situation where the insured, a construction worker, cannot perform their usual physical labor due to a leg injury, which directly impacts their ability to fulfill their occupational duties. Therefore, they are eligible for temporary total disablement benefits. Temporary partial disability applies when the insured can perform some, but not all, of their duties. Permanent total disablement requires a condition that permanently prevents the insured from working. Medical expenses cover the costs of treatment, not lost income due to inability to work.
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Question 16 of 30
16. Question
An individual in Singapore purchases a personal accident insurance policy with coverage starting on 1st July. The premium is due on or before this date. If the premium is not paid until 5th July, what is the status of the policy according to the Payment Before Cover Warranty clause, as it relates to CMFAS regulations?
Correct
According to the Payment Before Cover Warranty clause in personal general insurance policies in Singapore, specifically clause 17A, if the policyholder is an individual, the total premium due must be paid and received in full by the insurer (or intermediary) on or before the inception date of the coverage. Failure to do so results in immediate cancellation of the policy, and no benefits are payable. Any subsequent payment will not reinstate the cancelled policy. This clause is crucial for understanding the conditions under which coverage is valid and when it can be voided due to non-payment. This is aligned with regulatory expectations for insurers to manage premium collection effectively and ensure clarity in policy terms, as overseen by MAS.
Incorrect
According to the Payment Before Cover Warranty clause in personal general insurance policies in Singapore, specifically clause 17A, if the policyholder is an individual, the total premium due must be paid and received in full by the insurer (or intermediary) on or before the inception date of the coverage. Failure to do so results in immediate cancellation of the policy, and no benefits are payable. Any subsequent payment will not reinstate the cancelled policy. This clause is crucial for understanding the conditions under which coverage is valid and when it can be voided due to non-payment. This is aligned with regulatory expectations for insurers to manage premium collection effectively and ensure clarity in policy terms, as overseen by MAS.
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Question 17 of 30
17. Question
According to Section 25(5) of the Insurance Act (Cap. 142) in Singapore, what is the primary responsibility of an individual when proposing for a personal accident insurance policy?
Correct
Under Section 25(5) of the Insurance Act (Cap. 142), a proposer for insurance has a duty to disclose all facts that they know or ought to know, which would influence the insurer’s decision to accept the risk or determine the premium. Failing to do so may render the policy void. This duty is paramount in ensuring fairness and transparency in the insurance contract. The question highlights the importance of this disclosure requirement in the context of a personal accident insurance proposal.
Incorrect
Under Section 25(5) of the Insurance Act (Cap. 142), a proposer for insurance has a duty to disclose all facts that they know or ought to know, which would influence the insurer’s decision to accept the risk or determine the premium. Failing to do so may render the policy void. This duty is paramount in ensuring fairness and transparency in the insurance contract. The question highlights the importance of this disclosure requirement in the context of a personal accident insurance proposal.
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Question 18 of 30
18. Question
According to the Singapore Tourism Board’s regulations concerning travel insurance, under which of the following circumstances is a licensed travel agent required to seek and record a customer’s decision regarding the purchase of travel insurance that covers travel agent insolvency?
Correct
The Singapore Tourism Board (STB) mandates that licensed travel agents must seek the decision of their outbound leisure customers regarding the purchase of Travel Insurance that covers travel agent insolvency when a customer makes a deposit or payment of S$500 or more, or purchases a travel package costing S$1,000 or more. This requirement aims to protect consumers against potential financial losses due to travel agent insolvency. Travel agents are required to record the decision of their customers on whether or not they want to purchase Travel Insurance. Trade Specific Agents are encouraged to offer consumers Travel Insurance covering travel agent insolvency.
Incorrect
The Singapore Tourism Board (STB) mandates that licensed travel agents must seek the decision of their outbound leisure customers regarding the purchase of Travel Insurance that covers travel agent insolvency when a customer makes a deposit or payment of S$500 or more, or purchases a travel package costing S$1,000 or more. This requirement aims to protect consumers against potential financial losses due to travel agent insolvency. Travel agents are required to record the decision of their customers on whether or not they want to purchase Travel Insurance. Trade Specific Agents are encouraged to offer consumers Travel Insurance covering travel agent insolvency.
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Question 19 of 30
19. Question
Mr. Tan, an HDB homeowner with a mortgage loan obtained in 2000, experiences a fire in his flat. The fire damages the original HDB-installed flooring and also destroys kitchen cabinets that he installed himself during a renovation. According to the HDB Fire Insurance Scheme, which of the following costs would be covered?
Correct
The HDB Fire Insurance Scheme is designed to cover the cost of reinstating or repairing the damaged internal areas of the flat as built by HDB, including fixtures and fittings as originally provided. It specifically excludes any renovations or additions made by the owner, as well as household contents. Therefore, the policy would cover the cost of repairing the original HDB-installed flooring but not the cost of replacing owner-installed kitchen cabinets or other renovations. The scheme is compulsory for HDB homeowners with a mortgage loan taken after 1 September 1994, highlighting its importance in the context of HDB properties and mortgage requirements.
Incorrect
The HDB Fire Insurance Scheme is designed to cover the cost of reinstating or repairing the damaged internal areas of the flat as built by HDB, including fixtures and fittings as originally provided. It specifically excludes any renovations or additions made by the owner, as well as household contents. Therefore, the policy would cover the cost of repairing the original HDB-installed flooring but not the cost of replacing owner-installed kitchen cabinets or other renovations. The scheme is compulsory for HDB homeowners with a mortgage loan taken after 1 September 1994, highlighting its importance in the context of HDB properties and mortgage requirements.
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Question 20 of 30
20. Question
According to Section 25(5) of the Insurance Act Cap 142 concerning packaged household insurance in Singapore, what is the applicant’s primary responsibility when completing the proposal form?
Correct
Under Section 25(5) of the Insurance Act Cap 142, an applicant has a duty to disclose all facts which they know or ought to know, fully and faithfully. Failure to do so may render the policy void. This duty is paramount in insurance contracts, as insurers rely on the information provided by applicants to assess risk and determine premiums. The other options are incorrect because they either misrepresent the legal requirement or suggest incorrect consequences for non-disclosure.
Incorrect
Under Section 25(5) of the Insurance Act Cap 142, an applicant has a duty to disclose all facts which they know or ought to know, fully and faithfully. Failure to do so may render the policy void. This duty is paramount in insurance contracts, as insurers rely on the information provided by applicants to assess risk and determine premiums. The other options are incorrect because they either misrepresent the legal requirement or suggest incorrect consequences for non-disclosure.
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Question 21 of 30
21. Question
Mr. Tan’s personal general insurance policy is due for renewal on July 1st. He only manages to pay half of the premium amount by the renewal date. According to the Payment Before Cover Warranty, what is the status of Mr. Tan’s policy?
Correct
According to the Payment Before Cover Warranty, the insurance coverage does not attach if the total premium due is not paid and received in full by the insurer (or the intermediary) on or before the inception or renewal date. Therefore, if Mr. Tan only pays half the premium by the renewal date, the policy will not be in effect, and no benefits are payable. This is a strict condition, and any payment received after the renewal date is considered ineffective.
Incorrect
According to the Payment Before Cover Warranty, the insurance coverage does not attach if the total premium due is not paid and received in full by the insurer (or the intermediary) on or before the inception or renewal date. Therefore, if Mr. Tan only pays half the premium by the renewal date, the policy will not be in effect, and no benefits are payable. This is a strict condition, and any payment received after the renewal date is considered ineffective.
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Question 22 of 30
22. Question
During a family vacation in Europe, Mr. Tan suffers a severe stroke and is hospitalized. His travel insurance includes emergency medical repatriation. According to standard travel insurance policies, who primarily decides whether Mr. Tan should be repatriated back to Singapore?
Correct
Emergency medical repatriation coverage in travel insurance is designed to transport the insured back to their home country (Singapore in this case) due to an accident or illness that occurs while they are abroad. The decision to repatriate rests with the attending medical doctor or the insurer’s contracted specialist company, ensuring that the repatriation is medically necessary and appropriate. Travel curtailment, on the other hand, covers situations where the insured person has to cut short their trip and return home earlier than planned due to specific disrupting events such as death or serious illness of a family member. Travel cancellation covers situations where the trip is abandoned, cancelled, or postponed before it commences due to specific events. Kidnap and hostage coverage provides a daily benefit if the insured is held hostage during their trip, subject to certain exclusions.
Incorrect
Emergency medical repatriation coverage in travel insurance is designed to transport the insured back to their home country (Singapore in this case) due to an accident or illness that occurs while they are abroad. The decision to repatriate rests with the attending medical doctor or the insurer’s contracted specialist company, ensuring that the repatriation is medically necessary and appropriate. Travel curtailment, on the other hand, covers situations where the insured person has to cut short their trip and return home earlier than planned due to specific disrupting events such as death or serious illness of a family member. Travel cancellation covers situations where the trip is abandoned, cancelled, or postponed before it commences due to specific events. Kidnap and hostage coverage provides a daily benefit if the insured is held hostage during their trip, subject to certain exclusions.
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Question 23 of 30
23. Question
Mr. Tan purchases a Whole Life CI Insurance policy with a 75% Acceleration Benefit. Following a critical illness diagnosis, what additional rider would be MOST beneficial to ensure his policy remains active without further premium payments on the remaining coverage, aligning with best practices under the Insurance Act?
Correct
An Acceleration Benefit CI Insurance cover prepays a portion or the full sum assured of the basic policy upon diagnosis of a covered critical illness. If the insured opts for less than 100% acceleration, a Critical Illness Waiver of Premium rider is advisable to waive future premiums on the remaining sum assured, ensuring the policy owner doesn’t have to worry about servicing premiums for the remaining coverage. This ensures continued coverage without financial strain during a critical illness.
Incorrect
An Acceleration Benefit CI Insurance cover prepays a portion or the full sum assured of the basic policy upon diagnosis of a covered critical illness. If the insured opts for less than 100% acceleration, a Critical Illness Waiver of Premium rider is advisable to waive future premiums on the remaining sum assured, ensuring the policy owner doesn’t have to worry about servicing premiums for the remaining coverage. This ensures continued coverage without financial strain during a critical illness.
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Question 24 of 30
24. Question
During a workplace accident, an insured individual loses four fingers on their right hand and also suffers the complete loss of their left arm. According to the typical ‘Schedule of Benefits’ in a Personal Accident insurance policy, which outlines compensation for permanent partial disablement, what compensation would the insured receive, assuming the policy adheres to standard compensation limits and the accident falls within the policy’s coverage?
Correct
The key to this question lies in understanding the compensation limits within a personal accident insurance policy. Specifically, the policy states that compensation will not be payable for any specific item of Result B or C (Permanent and Total/Partial Disablement) where that item is also comprised in any other item of Result B or C for which a greater amount of compensation is payable. In this scenario, the loss of four fingers on one hand (40% of Sum Insured) is a permanent partial disablement. However, the loss of one arm (100% of Sum Insured) is a greater compensation. Therefore, only the greater compensation (loss of one arm) is payable. This is to prevent ‘double dipping’ where multiple disabilities arising from the same accident are compensated individually when a more encompassing disability exists. This aligns with the principle of indemnity, preventing the insured from profiting from a loss. This question tests the understanding of how compensation limits are applied when multiple injuries occur from a single accident, as per the policy’s schedule of benefits.
Incorrect
The key to this question lies in understanding the compensation limits within a personal accident insurance policy. Specifically, the policy states that compensation will not be payable for any specific item of Result B or C (Permanent and Total/Partial Disablement) where that item is also comprised in any other item of Result B or C for which a greater amount of compensation is payable. In this scenario, the loss of four fingers on one hand (40% of Sum Insured) is a permanent partial disablement. However, the loss of one arm (100% of Sum Insured) is a greater compensation. Therefore, only the greater compensation (loss of one arm) is payable. This is to prevent ‘double dipping’ where multiple disabilities arising from the same accident are compensated individually when a more encompassing disability exists. This aligns with the principle of indemnity, preventing the insured from profiting from a loss. This question tests the understanding of how compensation limits are applied when multiple injuries occur from a single accident, as per the policy’s schedule of benefits.
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Question 25 of 30
25. Question
Mr. Tan purchased a travel insurance policy for a trip to Europe. He did not disclose his pre-existing heart condition on the application form. During the trip, he suffered a heart attack and incurred significant medical expenses. The insurance company denied his claim upon discovering his medical history. According to the Insurance Act (Cap. 142), is the insurance company justified in denying the claim?
Correct
This scenario highlights the importance of understanding the implications of non-disclosure as per Section 25(5) of the Insurance Act (Cap. 142). Failing to disclose pre-existing conditions can render the policy void, leaving the insured without coverage for related medical expenses. The insurer is entitled to void the policy because the insured did not fully and faithfully disclose all known facts relevant to the risk being proposed, specifically the pre-existing heart condition. This non-disclosure materially affects the insurer’s assessment of risk and willingness to provide coverage.
Incorrect
This scenario highlights the importance of understanding the implications of non-disclosure as per Section 25(5) of the Insurance Act (Cap. 142). Failing to disclose pre-existing conditions can render the policy void, leaving the insured without coverage for related medical expenses. The insurer is entitled to void the policy because the insured did not fully and faithfully disclose all known facts relevant to the risk being proposed, specifically the pre-existing heart condition. This non-disclosure materially affects the insurer’s assessment of risk and willingness to provide coverage.
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Question 26 of 30
26. Question
A construction worker injures his back in a workplace accident, rendering him unable to perform heavy lifting and manual labor, which are essential parts of his job. While recovering, he takes on a temporary role as a site supervisor, which is less physically demanding. Considering the typical provisions of a Personal Accident insurance policy, which benefits, if any, is he most likely eligible for?
Correct
Temporary total disablement benefits are designed to provide financial support when an insured person is temporarily unable to perform the duties of their specific occupation due to an accident. The key factor is the inability to perform every duty of their profession, not just any job. The scenario highlights that the insured can still perform some work, but not their primary occupation as a construction worker. Therefore, they would be eligible for temporary total disablement benefits. Medical expense coverage reimburses costs incurred for treatment of bodily injuries following an accident, within a specified period and up to a prescribed limit. Double indemnity applies under specific circumstances, such as when traveling as a fare-paying passenger on public transport or due to events like fire or flood, and it doubles the death or permanent total disablement benefit. Hospital cash benefits provide a fixed daily amount during hospital confinement due to accidental injury, irrespective of actual hospital charges, and do not extend to recuperation benefits.
Incorrect
Temporary total disablement benefits are designed to provide financial support when an insured person is temporarily unable to perform the duties of their specific occupation due to an accident. The key factor is the inability to perform every duty of their profession, not just any job. The scenario highlights that the insured can still perform some work, but not their primary occupation as a construction worker. Therefore, they would be eligible for temporary total disablement benefits. Medical expense coverage reimburses costs incurred for treatment of bodily injuries following an accident, within a specified period and up to a prescribed limit. Double indemnity applies under specific circumstances, such as when traveling as a fare-paying passenger on public transport or due to events like fire or flood, and it doubles the death or permanent total disablement benefit. Hospital cash benefits provide a fixed daily amount during hospital confinement due to accidental injury, irrespective of actual hospital charges, and do not extend to recuperation benefits.
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Question 27 of 30
27. Question
A homeowner’s insurance policy includes coverage for ‘Collision or Impact’. Which of the following scenarios would MOST likely be excluded from coverage under this specific provision, assuming standard policy terms and conditions as per the Singapore College of Insurance guidelines?
Correct
The key here is understanding the scope of ‘Collision or Impact’ within a standard Houseowner’s Insurance policy. The policy typically covers damage from external sources like falling trees or vehicles. However, it explicitly excludes damage caused by items under the insured’s care or control. Since the insured is responsible for maintaining their own property, damage caused by a tree they own falling onto their house would not be covered under this specific peril. The other options represent events that would typically be covered under a standard policy’s ‘Collision or Impact’ clause, assuming they originate from outside the insured’s property and control.
Incorrect
The key here is understanding the scope of ‘Collision or Impact’ within a standard Houseowner’s Insurance policy. The policy typically covers damage from external sources like falling trees or vehicles. However, it explicitly excludes damage caused by items under the insured’s care or control. Since the insured is responsible for maintaining their own property, damage caused by a tree they own falling onto their house would not be covered under this specific peril. The other options represent events that would typically be covered under a standard policy’s ‘Collision or Impact’ clause, assuming they originate from outside the insured’s property and control.
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Question 28 of 30
28. Question
An employer’s Foreign Domestic Worker (FDW) is hospitalized due to an injury sustained at home. Under the Foreign Worker’s Levy compensation extension of the FDWI policy, what does this extension primarily cover, according to prevailing regulations and policy conditions?
Correct
The Foreign Worker’s Levy compensation extension in a Foreign Domestic Worker Insurance (FDWI) policy is designed to reimburse the employer for the levy imposed by the Ministry of Manpower (MOM) during periods when the FDW is hospitalized and unable to work. This compensation typically covers a nominal sum per day for each day of hospitalization, up to a specified maximum period, and includes the wages the employer continues to pay the FDW in addition to the levy. It does not cover the full wages of the FDW, nor does it cover the cost of hiring a temporary replacement or the cost of medical treatment for the FDW.
Incorrect
The Foreign Worker’s Levy compensation extension in a Foreign Domestic Worker Insurance (FDWI) policy is designed to reimburse the employer for the levy imposed by the Ministry of Manpower (MOM) during periods when the FDW is hospitalized and unable to work. This compensation typically covers a nominal sum per day for each day of hospitalization, up to a specified maximum period, and includes the wages the employer continues to pay the FDW in addition to the levy. It does not cover the full wages of the FDW, nor does it cover the cost of hiring a temporary replacement or the cost of medical treatment for the FDW.
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Question 29 of 30
29. Question
Mr. Tan, a CMFAS certified individual, advises a client on a Golfer’s Insurance policy. His client wants to understand what the ‘Hole-In-One’ extension covers. Which of the following expenses would typically be reimbursed under this extension, assuming all policy conditions are met and in compliance with Singapore regulations?
Correct
The ‘Hole-In-One’ extension in a Golfer’s Insurance policy specifically covers the cost of hospitality (food and beverages) incurred by the insured when they achieve a hole-in-one on a recognized golf course. This coverage is subject to a limit specified in the policy and local customs or rules of the club. Verification from the golf club, such as an authenticated certificate, and receipts for the expenses are typically required for claims. It does not cover travel expenses for family to celebrate, replacement of golfing equipment, or lost wages due to celebration.
Incorrect
The ‘Hole-In-One’ extension in a Golfer’s Insurance policy specifically covers the cost of hospitality (food and beverages) incurred by the insured when they achieve a hole-in-one on a recognized golf course. This coverage is subject to a limit specified in the policy and local customs or rules of the club. Verification from the golf club, such as an authenticated certificate, and receipts for the expenses are typically required for claims. It does not cover travel expenses for family to celebrate, replacement of golfing equipment, or lost wages due to celebration.
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Question 30 of 30
30. Question
A policyholder initially classified under Occupation Class I for their Personal Accident (PA) insurance takes on a new role that involves regular use of machinery. How should the insurance company respond, according to standard underwriting practices?
Correct
Insurers classify occupations into different classes (I, II, III) based on risk levels to determine PA insurance premiums. Class I typically includes professionals in non-hazardous office environments, Class II involves supervisory roles with minimal exposure to hazards, and Class III includes manual labor with machinery or tools. The classification helps insurers set appropriate premiums reflecting the risk associated with each occupation. A change in occupation to a riskier class would necessitate a premium adjustment to reflect the increased risk exposure.
Incorrect
Insurers classify occupations into different classes (I, II, III) based on risk levels to determine PA insurance premiums. Class I typically includes professionals in non-hazardous office environments, Class II involves supervisory roles with minimal exposure to hazards, and Class III includes manual labor with machinery or tools. The classification helps insurers set appropriate premiums reflecting the risk associated with each occupation. A change in occupation to a riskier class would necessitate a premium adjustment to reflect the increased risk exposure.