IC02 - LICENTIATE - Practice of Life Insurance 17

Q 1. What is the main advantage of a unit-linked insurance plan (ULIP)?

A) Higher returns on investment

B) Insurance protection and investment combined

C) Guaranteed income after retirement

D) Tax-free withdrawals

E) None of the above

 
Q 2. Which fund primarily invests in equity and equity-related instruments?

A) Equity Fund

B) Debt Fund

C) Balanced Fund

D) Money Market Fund

E) None of the above

 
Q 3. Which of the following is NOT a rider benefit available in ULIPs?

A) Major surgical assistance benefit

B) Hospital cash benefit

C) Spouse insurance benefit

D) Critical illness rider

E) None of the above

 
Q 4. What does NAV stand for in ULIPs?

A) Net Asset Valuation

B) National Asset Value

C) Net Available Value

D) Net Asset Value

E) None of the above

 
Q 5. Which feature of ULIPs allows policyholders to increase their insurance coverage during the tenure of the plan?

A) Flexibility to increase the insurance cover

B) Flexibility in change of premium

C) Liquidity

D) Top-up

E) Riders

 
Q 6. Which of the following is NOT a rider available with ULIPs?

A) Accidental Death Benefit (AD2) Rider

B) Disability Benefit Rider

C) Critical Illness Rider

D) Hospital Cash Benefit Rider

E) Surrender Benefit Rider
 

Q 7. According to the IRDA guidelines, what is the revised lock-in period for all Unit Linked Products, including top-up premiums?

A) Three years

B) Four years

C) Five years

D) Six years

E) Seven years

 
Q 8. What is the term used for the amount invested in funds in ULIPs?

A) Contribution

B) Premium

C) Units

D) NAV

E) Top-up

 
Q 9. What is the significance of the principle of utmost good faith in insurance contracts?

A) It imposes a duty on the buyer to be cautious before entering into a contract.

B) It ensures that all facts known to the proposer are disclosed to the insurer.

C) It allows non-disclosure of relevant facts without consequences.

D) It applies only to non-life insurance contracts.

E) It creates an adverse selection in the insurance market.

 
Q 10. How does Ramesh benefit from the continued well-being of the subject matters mentioned in the passage?

A) He gains financial stability.

B) He avoids accidents and injuries.

C) He safeguards his property.

D) He ensures his family's good health.

E) He enjoys continued benefits in his life.

 
Q 11. What should the prospect expect after completing the application process for life insurance?

A) Immediate approval and policy issuance

B) A waiting period for underwriting and evaluation

C) Requests for additional information or documentation

D) A medical report or assessment from the examination

E) All of the above

 
Q 12. What is the purpose of the agent's confidential report in an insurance proposal?

A) To assess the risk and acceptability of the proposal

B) To provide financial statements of the proposer

C) To verify the identity of the proposer

D) To determine the premium amount

E) To provide medical examination results

 
Q 13. Why do insurers authorize specific medical examiners to conduct the examinations?

A) To ensure consistency and standardization in the examination process

B) To reduce the cost of medical examinations

C) To provide convenience for the parties involved

D) To have access to specialized testing facilities

E) To comply with regulatory requirements

 
Q 14. Which factor(s) are considered by underwriters when assessing the risk of death?

A) Age

B) Health

C) Habits

D) All of the above

E) None of the above

 
Q 15. What does it mean when a life insurance proposal is accepted at Ordinary Rates (O.R)?

A) The person to be insured is considered a standard or normal risk

B) The premium charged is higher than standard rates

C) The sum assured is lower than proposed

D) The policy term is shorter than proposed

E) None of the above