IC02 - LICENTIATE - Practice of Life Insurance 29
IC02 - LICENTIATE - Practice of Life Insurance 29
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Q 1. What is the purpose of extended-term insurance coverage based on the net surrender value?
A) To provide additional coverage for a specific period
B) To convert the policy into a paid-up policy
C) To refund the surrender value to the policyholder
D) To extend the policy term without any changes
E) To offer a higher surrender value to the policyholder
Q 2. What do people often fail to understand about the option of automatic advance of future premiums?
A) The availability of loans from the surrender value
B) The addition of a bonus
C) The extension of risk cover
D) The reduction in premiums
E) The long-term benefits of the policy
Q 3. Why do some insurers not allow policy revival after a certain period of lapse?
A) High administrative costs
B) Insufficient funds
C) Inadequate documentation
D) Financial risk for the insurer
E) Legal restrictions
Q 4. How is the revised premium payable calculated under the Special Revival Scheme?
A) Same premium as the original policy
B) Fixed premium amount for all revival cases
C) Based on the age of the life assured at the new date of commencement
D) Calculated based on the policy surrender value
E) None of the above
Q 5. Are the revival procedures for PLI the same as those followed by other insurers?
A) Yes, they are the same
B) No, they are different
C) It depends on the policy type
D) It depends on the sum assured
E) It depends on the policy term
Q 6. What is one of the reasons why the assignment of an insurance policy is done?
A) To obtain additional coverage
B) To surrender the policy for cash value
C) To modify the terms of the policy
D) To provide security against a loan
E) To transfer ownership to the insurance agent
Q 7. How can nomination be done after the commencement of the policy?
A) By signing a separate endorsement form
B) By sending a letter to the insurer notifying the nomination
C) By submitting a nomination application to the insurance company
D) By appointing a legal representative to handle the nomination process
E) By recording the nomination details in the policyholder's will
Q 8. What happens in case of the death of the nominee or the assignee before the settlement of the death claim?
A) The death claim is forfeited
B) The death claim is paid to the legal heirs of the deceased nominee/assignee
C) The death claim is paid to the policyholder
D) The death claim is returned to the insurance company
E) The death claim is distributed among the surviving nominees
Q 9. What happens if the policyholder dies within six months of taking a loan against the policy?
A) The loan is waived off
B) The interest is refunded
C) The interest is charged up to the date of death
D) The loan is transferred to the nominee
E) The loan is adjusted against the surrender value
Q 10. What happens to the policy's nomination after foreclosure?
A) The nomination remains valid
B) The nomination is canceled automatically
C) The policyholder needs to update the nomination after foreclosure
D) The nomination becomes inactive
E) It depends on the insurance company's policy
Q 11. How are insurance claims reviewed by the insurance company?
A) They are automatically approved without review
B) They are reviewed by a third-party mediator
C) They are evaluated for their validity and adherence to policy terms
D) A government regulatory authority reviews them
E) The policyholder's family members review them
Q 12. What can be deducted from the gross amount of a maturity claim?
A) Loan amount
B) Outstanding interest on the loan
C) Unpaid premium
D) All of the above
E) None of the above
Q 13. Once the branch office receives the intimation of death and verifies its genuineness, what does it do next?
A) Pays the claim amount immediately
B) Cancel the policy
C) Sends necessary claim forms and instructions to the claimant
D) Requests additional documentation
E) None of the above
Q 14. When do insurers usually repudiate the contract in case of early claims?
A) Only on grounds of misrepresentation
B) Only when material information is suppressed
C) When there is evidence to the contrary
D) Insurers do not repudiate the contract in case of early claims
E) None of the above
Q 15. Which of the following statements is true regarding the requirement of additional documents for death claims due to accidents or unnatural causes?
A) They are only required for early death claims
B) They are only required for non-early death claims
C) They are required for both early and non-early death claims
D) They are not required if the cause of death is already established
E) They are required only if the death occurred within the first year of the policy