Wrong interpretation of question

[Trevor]

Hi, I have a concern about interpretation of questions.

What happens if, I interpret and answer the question slightly differently than how it is "supposed to be", but somehow my points coincide with the solutions?
In such case, will those points score mark? Or it is a straight zero for the whole question because I am not answering the question the way they want it?

For example in 2019 September paper, question 2 iii:
My interpretation during my practice (under exam conditions) is that:
Territory X is a new market, with rapidly growing insurance market.
How the regulation will be like, to "protect" the current state of the market
ie: the market is already rapidly growing before any regulations, how to keep this going?

Whereas the examiner report interprets the question as:
What did the regulators do, that caused the market to be rapidly growing
ie: What regulations caused this situation to happen?

I agree this could be a way to see it, depending on which phrase of the question we emphasize more.

The coinciding points in this case are:
My solution:
Capital calculations are very simple, because the regulators appreciate that the country is new and do not have expertise.
Examiner report:
The capital calculations are simple, that is how the market is developing quickly

We both agree that the calculation should be simple, but I am saying it is simple to maintain the situation;
whereas the solution is saying the rapid development implied the calculation is simple.
Do I still score in this case? We have the same conclusion, but I am interpreting the question differently


Although in this example it is only 5 marks, I am really worried because if this happens to a heavy question (20 marks say), I could potentially score zero out of 20, and fail the exam just for this silly reason.

 

[Lindsay Smitherman]

Hi - I think there are a couple of things to address here: this particular question and the wider issue about misinterpreting a question.

Looking at this Sept 2019 question, I am struggling to see that the two interpretations you have cited here are actually that different. To get a good breadth of ideas, I would consider all of the following (based on the info given in the question):

• new insurance market in X vs mature / stable market in UK - so probably simpler, less developed regulations
• high sales growth: think about aspects of the regulatory approach in X which might have caused this (since it has already happened) and how this might mean that the regulator has to spend more time regulating sales than is the case in the UK (where the sales process and related governance is more established)
• government wanting to continue to grow the industry - so need to think about how regulation in X needs to encourage and support this.

Getting breadth of ideas is normally vital - so the more angles you can use to tackle a question with, the better.

That should also reduce the risk that you end up going totally down the wrong route with any question.

I think you might be over-thinking things a bit here. The question isn't as narrowly worded as either of the interpretations that you have suggested above. It is really important for SA to be able to step back and see a range of bigger picture ideas, rather than focusing too much on one particular angle.

 

[Trevor]

Thanks Lindsay. I agree that it is important to see things at different angle, but it could be because I am reviewing my own attempt, my own assessment is - "whatever is not in the solution is considered wrong".

So in this case, my direction is seeing that, the market is growing, what should the regulator do?
My idea is that the regulatory should take a cautious approach:
1. Making sure reserves are very prudent, avoid collapsing of a major insurer
2. Allowing only standard model, assuming the insurers have no expertise and will use internal model wrongly
3. Highly prescriptive regulations - to have high level of scrunity
However, since this is a Discuss question, I topped up with counter arguments saying why the regulators shouldn't do these too.

However the solution is more of explaining what did the regulator do leading to rapid growing market
so their argument is pretty much the opposite of what I said:
1. Regulations focused on sales
2. Using a rule based (less prescriptive) regulation, giving more freedom

In essence, I am assuming the regulator will take a cautious approach and then explained it that way.

 

[Lindsay Smitherman]

As I said above, you are reading the examiners' solution too narrowly. Their points are not all about 'what did the regulator do that led to a rapidly growing market'.

The first few points in the ER solution are about regulation being focused on sales: this relates to the second half of my second bullet point above, not the first half. The angle for all of these points in the solution is: because there is very high sales growth, the regulator needs to focus on making sure those sales are robust and appropriate for customers (otherwise the industry is going to be stacking up a lot of problems for itself).

The points in the ER solution about not having overly restrictive regulations relate to my third bullet point, ie the government wanting to continue to grow the industry.

So, as I said above, you needed to make sure you were using all of the given aspects of the scenario.

Your answer seemed to be focusing on having very tight regulation - but that would cause barriers to entry and wouldn't be consistent with the information provided about the government wanting to grow the insurance industry.

It doesn't matter how a point is phrased to get the (half) mark, provided it demonstrates understanding of the underlying idea that the examiners are looking for. So that last point could be expressed as 'regulations might be more relaxed in order to avoid creating barriers to entry' or 'if regulations were too onerous, that would create a barrier to entry' or 'if regulations were too onerous, that could prevent the government's aim of growing the industry' or whatever.

But it does need to be consistent with the context of what is being asked.

Be careful not to interpret 'Discuss' as meaning 'pros and cons'. That will be the case sometimes, but not always - it depends on the context of the specific question. 'Discuss' is typically used where the solution isn't definitive - where there are likely to be lots of 'maybes' (and so you should expect to use the words 'might' and 'may' quite a lot in your answer). Here, for example, you don't know what regulation there actually is in country X, so you can't 'Describe' what it is. You need to 'Discuss' possibilities.

It isn't productive to spend a lot of time thinking about 'would I have got a mark for X?', 'would I have got a mark for Y?' etc. You really need to avoid getting too sucked into details. More productive is to work on strategies that maximise your chances of picking up the marks, including:

• generating a range of angles to use in your answer and working on idea generation techniques
• reading the question very carefully, several times, and then sticking to what has been asked for
• using the scenario information provided to tailor and filter your answer points