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Fit & Proper FSP License (Fit & Proper/Operational Ability)
An FSP wants to demonstrate the operational ability and risk cover expected of it. Which of the following is a recognised requirement?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Maintaining appropriate professional indemnity and/or fidelity cover (or equivalent guarantees) as required for its category.Correct
- b) Owning a fleet of luxury vehicles for its directors.
- c) Sponsoring a professional sports team.
- d) Holding the largest market share in its province.
Why this is the answer
Operational-ability and risk-management requirements include maintaining suitable professional indemnity and/or fidelity insurance (or equivalent guarantees) appropriate to the FSP's licence category. Luxury assets and market share are irrelevant to this requirement.
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