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IIQE Paper 1 Structure of Hong Kong Insurance Industry question: business interruption cover

IIQE Paper 1Structure of Hong Kong Insurance Industry

A retailer buys cover against loss of profits after a fire forces it to close. Under Schedule 1, this business interruption cover is in:

A class 14, credit
B class 9, damage to property
C class 8, fire and natural forces
D class 16, miscellaneous financial loss

Show the answer and explanation

Answer: D. class 16, miscellaneous financial loss

Answer: class 16, miscellaneous financial loss. Class 16 covers loss attributable to interruption of the insured's business.Why not the others:• class 14, credit: class 14 covers debtors' failure to pay.• class 9, damage to property: class 9 covers other physical damage.• class 8, fire and natural forces: class 8 covers damage to property, not the loss of profits.Watch out: Following the cause (fire) instead of the loss insured (profits).Rule: Classify by what is insured: property damage is class 8 or 9; interruption loss is class 16.Source: IA P1 Study Notes 2024 Ed. §5.1.1(b), p.5/3; Insurance Ordinance (Cap. 41) Sch. 1, Parts 2-3 (e-Legislation, checked 31 Oct 2026)

Common mistake

Following the cause (fire) instead of the loss insured (profits).

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Related IIQE Paper 1 questions

A contract on a group of persons under which accumulated contributions go to the last survivor or survivors at the end of a set period is a An insurer issues a group retirement scheme contract that provides a guaranteed capital or return. Under Schedule 1, this is Which body runs a scheme that assumes liabilities under employees' compensation policies of member insurers that have become insolvent?

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Original study material written to the public IIQE Paper 1 syllabus. Independent, not endorsed by the Insurance Authority or the VTC. Verify figures and rules against current guidance before relying on them.