R05 Long-term care and its regulation: free practice questions

1. Question 1 of 5

   Which body regulates long-term care insurance in the UK?

   Option A: The Office of the Public GuardianOption B: The Care Quality CommissionOption C: The Financial Conduct AuthorityOption D: The Department of Health

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   The answer is C: The Financial Conduct Authority

   The FCA regulates long-term insurance, including long-term care insurance, and its Handbook Glossary defines a long-term care insurance contract.

   Why the other options are wrong

   A

   The Office of the Public Guardian deals with powers of attorney and deputies.

   B

   The CQC regulates care providers, not insurance.

   D

   The Department of Health doesn't regulate insurance products.

2. Question 2 of 5

   Under the FCA definition, when are benefits under a long-term care insurance contract payable?

   Option A: When health means they cannot live independently without help, permanentlyOption B: When the policyholder decides to sell their homeOption C: When the policyholder reaches State Pension age and retires from workOption D: When the policyholder is admitted to hospital for any reason

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   The answer is A: When health means they cannot live independently without help, permanently

   The definition centres on health deteriorating to the point that the policyholder cannot live independently without assistance, with no expected improvement, and benefits capable of being paid periodically.

   Why the other options are wrong

   B

   Selling the home isn't a trigger for benefit.

   C

   Reaching State Pension age isn't a trigger for benefit.

   D

   Any hospital admission isn't enough; the test is inability to live independently.

3. Question 3 of 5

   According to the 2021 census, roughly what proportion of the population of England and Wales was aged over 65?

   Option A: 8.6%Option B: 18.6%Option C: 28.6%Option D: 12.4%

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   The answer is B: 18.6%

   Over 65s made up 18.6% of the population in 2021, around 11 million people, up from 16.4% in 2011, pointing to growing demand for care advice.

   Why the other options are wrong

   A

   8.6% is far too low; the figure was 18.6%.

   C

   28.6% is too high; it was 18.6%.

   D

   12.4% is too low; it was 18.6%.

4. Question 4 of 5

   Why is it difficult to give a single national picture of State long-term care provision in the UK?

   Option A: Care is funded entirely by private insurers across the whole of the UKOption B: Each nation takes its own approach, and local authorities set prioritiesOption C: Only Scotland provides any public funding for long-term care at allOption D: The rules are identical everywhere but rarely applied

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   The answer is B: Each nation takes its own approach, and local authorities set priorities

   Each nation has its own approach and much provision is through local authorities, which set their own priorities and eligibility thresholds.

   Why the other options are wrong

   A

   Care isn't funded entirely by private insurers.

   C

   All four nations provide some public funding for care.

   D

   The rules aren't identical; each nation and local authority takes its own approach.

5. Question 5 of 5

   Some whole of life policies pay part of the death benefit early if the life assured cannot live independently. Why can these often be sold by intermediaries with only ICOBS authorisation?

   Option A: They are designed to fall outside the FCA definition of long-term care insuranceOption B: They are classed as general insurance rather than as long-term insuranceOption C: They are exempt from all forms of regulationOption D: They do not provide any benefit on death

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   The answer is A: They are designed to fall outside the FCA definition of long-term care insurance

   Most care riders on whole of life policies are designed not to meet the FCA long-term care insurance definition, so ICOBS-authorised intermediaries can advise on them. A claim can leave dependants under-insured on later death.

   Why the other options are wrong

   B

   Whole of life policies are long-term insurance, not general insurance; the point is they avoid the LTCI definition.

   C

   They aren't free of regulation; ICOBS still applies.

   D

   These policies do pay on death; the care rider brings part of that forward.

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