Professional Ethics in Insurance Flashcards
6 cards from real BCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Professional Ethics in Insurance flashcards as text
What does 'know your client' (KYC) mean for insurance professionals in Singapore?
Answer: Understanding client needs, financial situation, risk appetite, and circumstances to make appropriate recommendations
KYC in an advisory context means thoroughly understanding the client's financial situation, needs, goals, risk tolerance, and circumstances to ensure recommendations are appropriate and suitable for them.
What is the consequence of misrepresentation by an insurance agent in Singapore?
Answer: Disciplinary action including license suspension or revocation, and potential civil or criminal liability
Misrepresentation by an insurance agent can result in disciplinary action (including suspension or revocation of registration), civil liability to affected clients, and potentially criminal prosecution for fraud.
What is the ethical significance of 'informed consent' in insurance sales?
Answer: It ensures clients understand what they are purchasing and agree based on accurate, complete information
Informed consent is ethically fundamental — clients must understand the product's features, costs, benefits, exclusions, and risks before agreeing to purchase. Without genuine understanding, consent is not truly informed.
What is the obligation of an insurance professional upon discovering a colleague has committed misconduct?
Answer: Report it to appropriate supervisory or regulatory authorities, as failure to report may itself constitute misconduct
Insurance professionals have an ethical and potentially regulatory obligation to report known misconduct by colleagues. Turning a blind eye to misconduct can itself constitute a breach of professional standards.
What does the 'best interest' duty require of insurance intermediaries in Singapore?
Answer: Acting in the client's best interest, even if it conflicts with the intermediary's own financial interest
The best interest duty requires intermediaries to prioritize the client's interests above their own financial interests, recommending products genuinely suitable for the client rather than those offering higher commissions.
What ethical standards does the Singapore College of Insurance (SCI) promote for insurance professionals?
Answer: Competence, integrity, professionalism, and continuous learning to maintain high standards of practice
The SCI promotes ethical standards including competence (staying technically current), integrity (honest dealing), professionalism (conduct becoming of the industry), and continuous education to maintain high standards.