IC02 - LICENTIATE - Practice of Life Insurance 30
IC02 - LICENTIATE - Practice of Life Insurance 30
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Q 1. Which channel is extensively used by insurers in India due to its extensive network and natural customer base?
A) Agency
B) Brokerage
C) BanksB) Brokerage C) Banks D) Direct mailing E) None of the above
D) Direct mailing
E) None of the above
Q 2. On what basis does the company calculate the premium?
A) The company's profit margin
B) The customer's credit score
C) The policyholder's age and health condition
D) The popularity of the insurance plan
E) The company's advertising budget
Q 3. What is the general rule regarding the impact of age on premiums?
A) Higher age results in higher premiums.
B) Higher age results in lower premiums.
C) Age has no impact on the premium calculation.
D) Premiums remain constant regardless of age.
E) Younger individuals pay higher premiums.
Q 4. Which of the following tasks is NOT a responsibility of an actuary?
A) Analyzing the past trend of the company's expenses and revenues
B) Defining and evaluating standards to assess risk
C) Providing advice on investment-related decisions
D) Designing insurance products
E) Selling insurance policies to customers
Q 5. How are net premiums calculated in insurance?
A) Based on the expected returns on investment
B) By subtracting the loading amount from the gross premium
C) By dividing the premium by the sum assured
D) As a fixed percentage of the policyholder's income
E) Using actuarial principles and mortality tables
Q 6. What adjustments can be made to premium rates based on the chosen mode of payment?
A) Adjustments for quarterly and monthly modes only
B) Adjustments for yearly mode only
C) No adjustments for any mode of payment
D) Adjustments for all modes of payment
E) Adjustments based on the sum assured only
Q 7. Which premium payment mode carries a higher risk of default?
A) Yearly
B) Half-yearly
C) Quarterly
D) Monthly
E) All modes have the same risk of default
Q 8. What factor influences the premium amount based on the guaranteed benefits offered?
A) Medical condition of the insured individual
B) Sum assured of the insurance policy
C) Type of insurance plan chosen
D) Interest rate offered by the company
E) Occupation of the insured individual
Q 9. How is the simple reversionary bonus calculated?
A) It is a fixed amount added to the sum assured.
B) It is a percentage of the basic sum assured added to the sum assured.
C) It is a percentage of the premium paid added to the sum assured.
D) It is calculated based on the policy term and age of the policyholder.
E) It is determined by the insurance company.
Q 10. What does the mortality table contain?
A) Premium rates for different age groups
B) Investment options for policyholders
C) Information about policy terms and conditions
D) Mortality rate for each age and gender
E) Financial aspects of risk to life
Q 11. Which of the following needs can be fulfilled by life insurance plans?
A) Buying luxury assets
B) Funding vacations
C) Creating a child education fund
D) Investing in stocks and bonds
E) Starting a new business
Q 12. What is an Endowment Assurance Plan a combination of?
A) Pure endowment plan and ULIP
B) Term assurance plan and money-back plan
C) Pure endowment plan and money-back plan
D) Term assurance plan and pure endowment plan
E) ULIP and money-back plan
Q 13. In which scenario is decreasing term insurance particularly useful?
A) When the insured person wants to pay premiums at regular intervals
B) When the insured person seeks a low-cost insurance option
C) When the insured person's financial obligations decrease over time
D) When the insured person wants the sum assured to increase over time
E) When the insured person wants to participate in bonus schemes
Q 14. What is the purpose of pure endowment plans in a money-back insurance policy?
A) Providing regular income during retirement
B) Accumulating savings for short-term financial goals
C) Paying periodic survival benefits during the policy term
D) Increasing the sum assured over time
E) Providing coverage for a specified term
Q 15. What happens if the survivor of a joint life policy dies during the term of the policy?
A) The policy is terminated, and no further benefits are payable.
B) The sum assured is transferred to the first policyholder's estate.
C) The sum assured is paid to the survivor's beneficiary.
D) The policy is extended for an additional term.
E) The policy continues with the same benefits until the original maturity date.