R05 Types of protection cover: free practice questions

1. Question 1 of 5

   Which type of cover provides help towards the costs of care needed because of old age or infirmity?

   Option A: Health cash planOption B: Payment protection insuranceOption C: Long-term care insuranceOption D: Private medical insurance

   Show answer

   The answer is C: Long-term care insurance

   Long-term care insurance provides cover towards the costs of long-term care due to old age or infirmity. PMI covers private treatment costs.

   Why the other options are wrong

   A

   A health cash plan pays small sums towards routine treatments, not care costs.

   B

   PPI covers loan or card repayments if the insured can't work.

   D

   PMI pays for private medical treatment, not the ongoing costs of care in old age.

2. Question 2 of 5

   Which type of cover typically provides small cash sums for a range of medical treatments or per day spent in hospital?

   Option A: Income protection insuranceOption B: A health cash planOption C: Accident, sickness and unemployment insuranceOption D: Critical illness cover

   Show answer

   The answer is B: A health cash plan

   Health cash plans pay small lump sums for treatments such as optical or dental care, or per day in hospital.

   Why the other options are wrong

   A

   Income protection pays a regular income during long-term incapacity.

   C

   ASU pays an income if accident, sickness or unemployment stops work, not small treatment sums.

   D

   Critical illness cover pays a lump sum on diagnosis of a serious condition.

3. Question 3 of 5

   What distinguishes accident, sickness and unemployment insurance (ASU) from personal accident and sickness insurance (PAS)?

   Option A: ASU also covers redundancy or unemploymentOption B: ASU only pays lump sums on deathOption C: ASU is a long-term contract that cannot be cancelledOption D: PAS covers unemployment but not sickness

   Show answer

   The answer is A: ASU also covers redundancy or unemployment

   Both can pay lump sums or income for accident or sickness, but ASU also covers inability to work due to redundancy or unemployment.

   Why the other options are wrong

   B

   ASU isn't a death benefit; it pays if the insured can't work.

   C

   ASU is short-term, renewable cover that the insurer can change or cancel.

   D

   It's the other way round: ASU covers unemployment and PAS doesn't.

4. Question 4 of 5

   What is a contract called that combines different types of cover, such as life assurance with critical illness and income protection options?

   Option A: A capitation schemeOption B: A group schemeOption C: A bondOption D: A menu plan

   Show answer

   The answer is D: A menu plan

   Single contracts providing several types of cover are usually called menu plans, for example life assurance with optional critical illness cover and, occasionally, income protection.

   Why the other options are wrong

   A

   A capitation scheme is a type of dental plan, not a combined protection contract.

   B

   A group scheme covers a group such as employees; it isn't about combining cover types.

   C

   A bond is an investment product.

5. Question 5 of 5

   Which of the following is NOT one of the main types of financial protection cover?

   Option A: Income protection insuranceOption B: Private medical insuranceOption C: Critical illness coverOption D: A stocks and shares ISA

   Show answer

   The answer is D: A stocks and shares ISA

   An ISA is a savings and investment wrapper, not protection. The main types include life assurance, IP, CIC, LTCI, PPI, PAS, ASU, PMI and health cash plans.

   Why the other options are wrong

   A

   Income protection is one of the main types of protection: it replaces income lost through illness or injury.

   B

   Private medical insurance is one of the main types of protection: it pays for private treatment of acute conditions.

   C

   Critical illness cover is one of the main types of protection: it pays a lump sum on diagnosis of a defined condition.

R0 Exam Prep is an independent revision tool. It is not produced, endorsed by or affiliated with the Chartered Insurance Institute (CII). Questions and explanations are original. Use it alongside the official study text. About R0 Exam Prep