All RE5 questions
Regulatory Bodies Short-term Insurance Twin Peaks
A short-term insurer lets clients buy cover online in five minutes, but requires anyone who wants to cancel to do so in person at its head office in another province. Which Treating Customers Fairly outcome is failing, and which regulator would act on it?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Outcome 6, and the Prudential Authority
- b) Outcome 3, and the Prudential Authority
- c) Outcome 6, and the FSCACorrect
- d) Outcome 5, and the FSCA
Why this is the answer
Outcome 6 requires that customers do not face unreasonable post-sale barriers to changing a product, switching provider, claiming or complaining. Forcing an in-person cancellation far away is such a barrier. Fair treatment of customers is market conduct, supervised by the FSCA; the Prudential Authority supervises soundness.
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