BCP General Insurance Products 2 — Questions and Answers
Question 1: What is 'public liability' insurance, commonly purchased by businesses in Singapore?
- Insurance covering employee salaries
- Insurance covering legal liability for injury or property damage to third parties occurring on the insured's premises or due to business operations (Correct answer)
- Insurance covering the company's own property
- Insurance covering the CEO's personal assets
Correct answer: Insurance covering legal liability for injury or property damage to third parties occurring on the insured's premises or due to business operations
Public liability insurance protects businesses against claims from third parties (e.g., customers, visitors) who suffer bodily injury or property damage due to the business's negligence.
Question 2: In Singapore, what is the Work Injury Compensation Act (WICA) insurance?
- Voluntary insurance for self-employed individuals
- Compulsory insurance covering employees for work-related injuries and occupational diseases (Correct answer)
- Insurance covering damage to workplace equipment
- Insurance covering workplace renovation costs
Correct answer: Compulsory insurance covering employees for work-related injuries and occupational diseases
Under WICA, employers in Singapore must insure employees doing manual work (regardless of salary) and non-manual workers earning $2,600 or less per month against work-related injuries and diseases.
Question 3: What is 'professional indemnity' insurance used for in Singapore?
- Covering office rental costs
- Protecting professionals against claims of negligence or errors in their professional services (Correct answer)
- Covering employee medical expenses
- Insuring professional qualifications
Correct answer: Protecting professionals against claims of negligence or errors in their professional services
Professional indemnity insurance covers professionals (e.g., doctors, lawyers, architects, accountants) against claims arising from errors, omissions, or negligent advice in the course of their professional duties.
Question 4: What does 'marine cargo' insurance cover for Singapore businesses?
- Only damage to the ship itself
- Loss or damage to goods being transported by sea, air, or land (Correct answer)
- Only port handling charges
- Only customs duties
Correct answer: Loss or damage to goods being transported by sea, air, or land
Marine cargo insurance covers goods in transit against risks like damage, loss, theft, and piracy. As Singapore is a major trading hub, this insurance is vital for import/export businesses.
Question 5: What is an 'excess' or 'deductible' in a Singapore general insurance policy?
- The maximum amount the insurer will pay
- The amount the insured must bear before the insurer starts paying a claim (Correct answer)
- An additional premium charged for risky activities
- The commission paid to the insurance agent
Correct answer: The amount the insured must bear before the insurer starts paying a claim
An excess or deductible is the portion of a claim that the policyholder must pay out of pocket before the insurer covers the remaining amount. It helps keep premiums lower.
Question 6: What type of insurance is mandatory for construction projects in Singapore under the Building Control Act?
- Travel insurance
- Contractors' All Risks (CAR) insurance (Correct answer)
- Life insurance for workers
- Cyber insurance
Correct answer: Contractors' All Risks (CAR) insurance
Contractors' All Risks insurance is required for construction projects in Singapore, covering loss or damage to the works, materials, and third-party liability during the construction period.
BCP General Insurance Products 2
What is 'public liability' insurance, commonly purchased by businesses in Singapore?