All RE5 questions
Code of Conduct Adhere to the specific Codes of Conduct
An advertisement for a market-linked policy shows a 'projected maturity value of R1.2 million' in large print. What does the General Code require?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Nothing further, provided the projection was calculated by a qualified actuary.
- b) Removal of the figure, because advertisements may never refer to future benefits.
- c) A clear statement that the projected value is not guaranteed.Correct
- d) Approval of the advertisement by the Authority before it is published.
Why this is the answer
An advertisement must not be misleading. Where it refers to future benefits that depend on the performance of underlying assets, it must make clear that the benefits are not guaranteed and are illustrative. Projections are not banned, an actuary's calculation does not remove the need for the warning, and advertisements are not pre-approved by the Authority.
Want to test yourself on 700+ more questions like this?
Start your free RE5 simulator today — timed mock exams, full answer explanations and cloud-synced progress tracking.
More Code of Conduct questions
- A broker has contracts with three insurers and may place business only with them. She t…
- A broker receives a client's premium cheque at 16:00 on the Thursday before Good Friday…
- A risk policy provides that the premium will increase every year. What does the General…
- A client instructs her adviser on Monday to buy a large block of a thinly traded share.…