AFAP1 — Protection — Unit 1

What AFAP1 covers

• •The need for protection: death, illness, disability, unemployment
• •State benefits: bereavement, ESA, PIP, Universal Credit — and their limits
• •Term assurance, whole of life and family income benefit
• •Critical illness cover: guaranteed vs reviewable, total permanent disability
• •Income protection: own-occupation vs suited, deferred period, proportionate benefit
• •ASU, PMI and the underwriting / disclosure process

3 free AFAP1 practice questions

Straight from Mock Paper 1, in the real exam style — no sign-up, no paywall.

1. Q1.Which event is income protection insurance primarily designed to cover?

   1. ADeath during the policy term
   2. BA specified list of serious medical conditions diagnosed while the policy is in force
   3. CLoss of earnings due to illness or injury that prevents the policyholder working
   4. DRedundancy from employment
   Reveal the answer

   C is correct. Income protection pays a regular income when illness or injury stops the client working, subject to the policy definition and deferred period. Death is life assurance; a defined list of conditions is critical illness cover; redundancy is typically ASU or no cover at all.

2. Q2.Statutory Sick Pay (SSP) in 2026 is best described as:

   1. AA means-tested benefit paid indefinitely until the employee returns to work
   2. BA flat-rate payment from the employer for up to 28 weeks, for employees who qualify
   3. CA Department for Work and Pensions benefit paid only to self-employed workers
   4. DA tax-free lump sum paid on diagnosis of a critical illness
   Reveal the answer

   B is correct. SSP is paid by the employer (not DWP) at a statutory weekly rate for up to 28 weeks to qualifying employees. It is not means-tested but is time-limited and unavailable to most self-employed people.

3. Q3.Decreasing term assurance is most commonly used to:

   1. AProvide a level lump sum for inheritance tax planning
   2. BMatch a repayment mortgage balance that falls over time
   3. CPay a monthly income to dependants instead of a lump sum
   4. DCover the policyholder for their entire life with an investment element
   Reveal the answer

   B is correct. Decreasing term assurance pays a lump sum that reduces in line with a repayment mortgage (or similar liability), so cover and debt fall together. Level term is used for interest-only mortgages and family protection; family income benefit pays income; whole of life covers for life.

How to pass AFAP1

• ✓Income protection pays a monthly income; CIC pays a lump sum. Mixing them is the classic trap.
• ✓Own-occupation IP is more valuable than suited-occupation — and costs more.
• ✓Non-disclosure: the insurer can avoid the policy if the misrepresentation was careless or deliberate.

AFAP1 exam — common questions