Paper 1, Principles and Practice of Insurance, is the common foundation in general, long-term and composite routes. The official format is 75 multiple-choice questions in two hours with a 70% pass mark. Its difficulty comes less from isolated definitions than from scenarios that combine risk, contract roles, insurance principles and intermediary duties.
Build four layers before memorising details
1. Risk and insurance
Pure and speculative risk, hazards, risk-management methods and risk pooling.
2. Contract and roles
The proposer, insured, insurer, beneficiary and intermediary cannot be used interchangeably.
3. Insurance principles
Utmost good faith, insurable interest, proximate cause, indemnity, subrogation and contribution belong on a timeline.
4. Market and regulation
Separate the IA, authorised insurers, agencies, brokers and individual licensees.
Six principles: ask three questions for each
| Principle | Core question | Typical confusion |
|---|---|---|
| Utmost good faith | What material information must be disclosed? | Importing assumptions from ordinary contracts |
| Insurable interest | Who suffers from damage to the subject matter? | Looking only for legal ownership |
| Proximate cause | What is the dominant effective cause? | Choosing the event that happened last in time |
| Indemnity | How is the pre-loss financial position restored? | Assuming every insurance benefit follows actual loss |
| Subrogation | Who may pursue a third party after indemnification? | Forgetting its connection with indemnity |
| Contribution | How do indemnity policies share one loss? | Confusing it with co-insurance or reinsurance |
What should condensed notes contain?
Good notes do not squeeze a handbook into smaller type. They turn each concept into a decision comparison. Hazard versus peril, agent versus broker, subrogation versus contribution, and premium versus sum insured should each be recorded as a definition, trigger, relevant parties and a wrong example.
Managing 75 questions
Two hours gives an average of about 96 seconds per item, but do not spend it evenly. Clear definition and role questions should be handled first; multi-principle scenarios can be revisited. During practice, flag uncertain correct answers as well as wrong answers because both expose unstable knowledge.
A seven-day starter cycle
- Days 1–2: risk, insurance function, contracts and roles.
- Days 3–4: the six principles, each with two original scenarios.
- Day 5: the market, IA and intermediary conduct.
- Day 6: mixed questions grouped by error reason.
- Day 7: a timed set, followed by focused repair in the study notes.
Official sources used
Use these primary sources to confirm any change after the article date.
