Exam ICWIM Topic 1 Question 69 Discussion
Actual exam question for CISI's ICWIM exam
Question #: 69
Topic #: 1
Question #: 69
Topic #: 1
For a key person protection policy, a company will:
Suggested Answer: D Vote an answer
Key person protection is a type of business insurance where a company takes out a life insurance policy on a key employee, such as a CEO or top executive.
* Why is Option D Correct?
* An insurable interest must exist # The company must demonstrate financial loss if the key person dies or becomes incapacitated.
* The policy protects against lost revenue, recruitment costs, and operational disruption.
* Why Not Other Options?
* A (Ever-increasing premiums) # Premiums may increase, but this is not a requirement.
* B (Protection against staff leaving) # Key person insurance does not cover resignations.
* C (Undefined sum) # The insured amount is calculated based on business impact.
# Reference: FCA Business Protection Regulations, CISI Wealth & Investment Management.
* Why is Option D Correct?
* An insurable interest must exist # The company must demonstrate financial loss if the key person dies or becomes incapacitated.
* The policy protects against lost revenue, recruitment costs, and operational disruption.
* Why Not Other Options?
* A (Ever-increasing premiums) # Premiums may increase, but this is not a requirement.
* B (Protection against staff leaving) # Key person insurance does not cover resignations.
* C (Undefined sum) # The insured amount is calculated based on business impact.
# Reference: FCA Business Protection Regulations, CISI Wealth & Investment Management.
by Lorraine at Jul 21, 2025, 09:45 AM
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