CIIN Certificate CF2 cheat sheet

Insurable interest must exist at inception for indemnity covers and at the death of the life assured for life policies; absence makes the contract unenforceable.

A material fact is one that would influence a prudent insurer's decision; non-disclosure or misrepresentation can make a policy voidable.

Indemnity restores the insured to the pre-loss financial position without profit; life and personal accident benefits are valued, not indemnity.

Proximate cause is the dominant and effective cause of a loss; remote causes are ignored when deciding whether a peril is covered.

Subrogation transfers the insured's recovery rights against a third party to the insurer after payment, capped at the amount paid.

Contribution applies when two or more policies cover the same insured, interest, risk and peril; each insurer pays a rateable share.

Risk pooling uses premiums from many policyholders to fund losses of the few; the law of large numbers improves loss predictability.

Adverse selection is the tendency of poorer-than-average risks to seek cover; underwriting, exclusions and pricing controls it.

NAICOM is the insurance regulator established by the National Insurance Commission Act 1997; it licenses and supervises insurers, brokers, agents and loss adjusters.

The Insurance Act 2003 is a principal Nigerian statute governing insurance business, licensing, policy terms, capital and market conduct.

The no-premium-no-cover rule means an insurer is generally not liable under a policy unless the premium has been paid.

Compulsory motor third-party insurance under the Motor Vehicles (Third Party) Insurance Act requires cover for third-party death or bodily injury.

A valid insurance contract requires offer, acceptance, consideration, capacity, legality and intention to create legal relations.

Utmost good faith applies to both parties; material misrepresentation or concealment can render a policy voidable.

The Pension Reform Act 2014 establishes Nigeria's contributory pension scheme, retirement savings accounts and PenCom regulation.

An insurance broker acts for the insured, while an insurance agent represents the insurer within the scope of authority granted.

Property claims are subject to the sum insured; underinsurance triggers the average clause: claim = loss x sum insured / value at risk.

Reinstatement cover replaces damaged property new-for-old; indemnity cover deducts depreciation and betterment.

Motor third-party cover is compulsory for third-party death or bodily injury; own damage cover is optional and subject to excess.

Institute Cargo Clauses (A) provide all-risks marine cargo cover; Clauses (B) and (C) cover narrower named perils.

General average is shared proportionately by ship, cargo and freight interests that benefit from a sacrifice to save a common maritime adventure.

Particular average is a partial loss borne by the owner of the affected property alone, not shared across all maritime interests.

Liability policies cover legal liability to third parties for bodily injury or property damage; they do not cover the insured's own property.

Burglary cover usually requires forcible entry; fidelity guarantee covers employee dishonesty, while money policies cover cash and negotiable instruments.

Life assurance requires insurable interest at policy inception, not necessarily at the time of death.

Term assurance pays only if death occurs within the term; survival produces no benefit and the policy has no cash value.

Whole life assurance pays on death whenever it occurs; endowment assurance pays on survival to maturity or on earlier death.

An annuity converts a lump sum into regular income; a life annuity pays for as long as the annuitant lives.

Under the Pension Reform Act 2014, private-sector contributions total 18% of monthly emoluments: 10% employer and 8% employee.

Retirement savings accounts are held with licensed pension fund administrators and regulated by PenCom.

Group life assurance covers a defined group of employees under one policy, usually with the employer paying the premium.

Life underwriting considers age, health, occupation, family history, habits and sum assured to classify mortality risk.

Underwriting selects, classifies and prices risks; decisions include acceptance, decline, premium loading, excess, exclusion or warranty.

Premium equals rate multiplied by exposure base; an adequate rate covers expected losses, expenses, profit and contingency.

Physical hazard is a tangible condition increasing loss likelihood; moral hazard is dishonest or careless attitude; morale hazard is indifference.

Experience rating uses the insured's past loss record; schedule rating uses risk characteristics such as construction, occupancy and protection.

Co-insurance shares a large risk among several insurers; reinsurance transfers part of the risk to a reinsurer.

Warranties and conditions must be met; endorsements amend policy terms and should be documented before cover changes.

The no-premium-no-cover rule affects acceptance and inception because cover generally starts only after premium payment.

Capacity is the maximum risk an insurer can retain; reinsurance increases underwriting capacity and protects solvency.

The claims process runs through notification, registration, investigation, loss adjustment, settlement and recovery.

A loss adjuster investigates and quantifies the loss; an assessor may value damage or property for settlement.

Claims reserves comprise case reserves for reported claims plus IBNR estimates for incurred but not reported claims.

Subrogation and salvage recoveries reduce the net cost of claims to the insurer.

Proportional reinsurance includes quota share and surplus treaties; non-proportional reinsurance includes excess of loss and stop loss.

Facultative reinsurance covers an individual risk by offer and acceptance; treaty reinsurance accepts a class of risks automatically.

Retention is the amount of risk the insurer keeps; cession is the amount transferred to the reinsurer.

The insured must take reasonable steps to mitigate loss; failure to do so can reduce or prejudice the claim.

The CIIN Code of Ethics requires integrity, competence, confidentiality, fairness and transparency from insurance practitioners.

Conflicts of interest must be disclosed and managed so that advice and placement decisions are not improperly influenced.

A broker is the insured's agent and should place cover in the client's interest; an agent represents the insurer.

Anti-money-laundering practice requires know-your-customer checks, identity verification, transaction monitoring and suspicious-transaction reporting.

Market documents include the proposal form, cover note, policy schedule, endorsement, renewal notice and claims form.

Professional indemnity insurance protects brokers and intermediaries against claims arising from professional negligence.

Complaints should first follow the insurer's internal process and may be escalated to NAICOM where unresolved.

Client information must be kept confidential and processed in line with data-protection obligations.