BCP - Basic Insurance Concepts and Principles Singapore Singapore's Insurance Market Structure Questions and Answers

Question 1

Which entity is the primary regulator for all insurance activities in Singapore, responsible for licensing insurers and intermediaries under the Insurance Act?

Accepted Answer

Monetary Authority of Singapore (MAS)

Answer

General Insurance Association (GIA)

Answer

Life Insurance Association (LIA)

Answer

Singapore Insurance Institute (SII)

Question 2

A large multinational corporation based in Singapore decides to self-insure the risks of its various subsidiary companies. It establishes a licensed insurance entity solely for this purpose. Under the structure of the Singapore insurance market, what is this type of insurer known as?

Accepted Answer

A Captive Insurer

Answer

A Direct Insurer

Answer

A Reinsurer

Answer

A Composite Insurer

Question 3

In the Singapore insurance market, what is the fundamental difference between an insurance agent and an insurance broker?

Accepted Answer

Agents represent the insurer(s), while brokers represent the policyholder (the client).

Answer

Agents can sell both life and general insurance, while brokers can only sell general insurance.

Answer

Brokers represent the insurer, while agents represent the policyholder.

Answer

Brokers are employed directly by the MAS, while agents are employed by insurance companies.

Question 4

Which of the following is a key function of the Life Insurance Association, Singapore (LIA)?

Accepted Answer

Representing the interests of life insurers and promoting industry best practices.

Answer

Issuing and revoking licenses for all life insurance companies in Singapore.

Answer

Adjudicating legal disputes between policyholders and life insurance companies.

Answer

Managing the Policy Owners' Protection Scheme for all insurance policies.

Question 5

A Singapore-based insurer wishes to reduce its exposure to a large portfolio of property insurance policies. It arranges a contract with another insurer to take on a portion of these risks in exchange for a premium. This process is known as:

Accepted Answer

Reinsurance

Answer

Direct underwriting

Answer

Captive insurance

Answer

Loss adjustment

Question 6

Which body, representing general insurers in Singapore, works to foster public confidence, promote efficiency, and represents its members' interests to the government and other organizations?

Accepted Answer

General Insurance Association of Singapore (GIA)

Answer

Monetary Authority of Singapore (MAS)

Answer

Financial Industry Disputes Resolution Centre (FIDReC)

Answer

Singapore College of Insurance (SCI)