IC02 - LICENTIATE - Practice Of Life Insurance 07
IC02 - LICENTIATE - Practice Of Life Insurance 07
Q 1. Which event may trigger a suicide clause in a life insurance policy?
A) Death of the life assured within the first year
B) Death of the life assured within two years
C) Death of the life assured as a result of war
D) Death of the life assured during aviation activities
E) None of the above
Q 2. What is a possible reason for a policyholder to request a reduction in the sum assured?
A) To increase the premium payment
B) To align the sum assured with changing circumstances
C) To add riders to the policy
D) To change the mode of payment
E) None of the above
Q 3. What precautions do insurers take when issuing duplicate policies?
A) They refuse to issue duplicate policies in most cases
B) They charge a high fee for duplicate policies
C) They require the policyholder to provide proof of loss
D) They immediately issue duplicate policies without verification
E) None of the above
Q 4. What is the purpose of the attestation on the policy document?
A) To validate the policyholder's signature
B) To indicate the acceptance of the proposal by the insurer
C) To certify the accuracy of the policy details
D) To acknowledge the payment of premiums
E) None of the above
Q 5. How does an insurer determine the premium for individuals participating in high-risk hobbies?
A) By offering discounts
B) By excluding coverage
C) By setting standard premiums
D) By declining the proposal
E) By reducing the policy term
Q 6. What is the age of the policyholder in Scenario 1? Date of birth: 4th July 1982 Date of commencement of the insurance plan: 4th Dec 2010
A) 27 years
B) 28 years
C) 29 years
D) 30 years
E) 31 years
Q 7. Why do some insurers not allow monthly premium payments?
A) Administrative convenience
B) Higher profitability for the insurer
C) Lower risk for the insurer
D) Reduced paperwork
E) Higher interest earnings for the insured
Q 8. What is the rebate for sum assured applicable for a policy with a sum assured of Rs. 35,000?
A) Rs. 0.50 per 1000 sum assured
B) Rs. 1.00 per 1000 sum assured
C) Rs. 1.50 per 1000 sum assured
D) Rs. 2.00 per 1000 sum assured
E) No rebate is applicable
Q 9. How long is the grace period generally allowed for monthly mode premium payments?
A) 7 days
B) 10 days
C) 15 days
D) 20 days
E) 30 days
Q 10. Can the insurer forfeit the premium paid by the policyholder if the policy lapses?
A) Yes, the insurer can forfeit the entire premium
B) No, the insurer cannot forfeit any premium
C) Yes, but only a portion of the premium
D) No, the law does not permit total forfeiture
E) Yes, but only if there is a non-forfeiture clause
Q 11. What is the purpose of a guaranteed surrender value in an insurance policy?
A) To incentivize policyholders to surrender their policies early
B) To ensure that policyholders receive a minimum amount upon surrender
C) To protect the insurer's financial interests
D) To reduce the overall cost of the policy for the policyholder
E) To encourage policyholders to continue paying premiums
Q 12. What is the surrender value in the given example if the surrender value rate is 80%?
A) Rs. 5,000
B) Rs. 8,800
C) Rs. 11,000
D) Rs. 6,600
E) Rs. 8,000
Q 13. How does the amount required to be advanced from the surrender value under the Extended Term Insurance cover option compare to the automatic advance of the premium option?
A) It is the same
B) It is higher
C) It is lower
D) It depends on the policyholder's age
E) It depends on the sum assured
Q 14. What does the revival process for a lapsed policy with increased risk cover resemble?
A) Underwriting a new proposal
B) Adjusting the policy benefits
C) Cancelling the policy
D) Converting the policy to a new type
E) Reviewing the policy terms and conditions
Q 15. How is the unpaid premium amount paid under the Instalment Revival Scheme?
A) Lump sum payment
B) Monthly installments
C) Quarterly installments
D) Half-yearly installments
E) Spread over two years along with regular premium