IC02 - LICENTIATE - Practice of Life Insurance 34

IC02 - LICENTIATE - Practice of Life Insurance 34

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Q 1. What benefits does a traditional plan provide?

A) Only death benefit

B) Only survival benefit

C) Both death benefit and survival benefit

D) Only premium refunds

E) Only investment returns

Q 2. When is increasing term insurance beneficial for an individual?

A) When the insured person wants to pay a lump sum premium at the beginning

B) When the insured person seeks a low-cost insurance option

C) When the insured person's income is expected to rise in the future

D) When the insured person wants the sum assured to decrease over time

E) When the insured person wants to participate in bonus schemes

Q 3. What is the primary benefit of a term assurance plan in a money-back insurance policy?

A) Providing regular income during retirement

B) Accumulating savings for short-term financial goals

C) Paying the full sum assured on the policy's maturity

D) Increasing the sum assured over time

E) Providing coverage in case of the insured's death during the policy term

Q 4. Do both individuals in a joint life policy undergo separate underwriting?

A) Yes, both individuals are assessed separately.

B) No, only the first policyholder undergoes underwriting.

C) No, only the survivor undergoes underwriting.

D) No, underwriting is not required for joint life policies.

E) Yes, but the underwriting process is simpler for joint life policies.

Q 5. When can Jagat nominate a person under the policy?

A) At the time of policy purchase

B) On his 7th birthday

C) On his 18th birthday

D) On the deferred date

E) After the policy anniversary following his 18th birthday

Q 6. What is a rider in insurance?

A) The base policy that provides the main coverage

B) An additional clause or condition added to the base policy for additional benefits

C) The premium payable on the policy

D) The maximum limit of coverage under the policy

E) The underwriting process involved in issuing the policy

Q 7. What was the key feature of industrial life insurance that made it successful?

A) Modest insurance cover for a small premium

B) Door-to-door collection of premiums

C) Coverage for industrial workers

D) Weekly premium payments

E) Convenience for the policyholders

Q 8. According to the MWP Act, who can purchase a policy under this scheme?

A) Any married woman

B) Any married man

C) Any divorced man

D) Any widower

E) Any individual with dependents

Q 9. What is the purpose of submitting an addendum to the insurance company when obtaining insurance under the MWP Act?

A) To nominate beneficiaries for the policy

B) To appoint a trustee for the policy

C) To change the terms and conditions of the policy

D) To cancel the policy

E) To transfer the policy to another individual

Q 10. What is the term used for diseases that are excluded from health insurance coverage?

A) Pre-existing illnesses

B) Critical illnesses

C) Chronic conditions

D) Acute illnesses

E) Incurable diseases

Q 11. What is Sharad Sharma's primary goal for his investment plan?

A) Accumulating wealth

B) Generating regular income after retirement

C) Achieving high returns

D) Maintaining financial liquidity

E) Ensuring a comfortable lifestyle during retirement

Q 12. Why do individuals purchase annuities?

A) To accumulate wealth for retirement

B) To receive a lump sum payment after retirement

C) To meet post-retirement financial needs

D) To obtain life insurance coverage

E) To achieve short-term financial gains

Q 13. What is the key characteristic of a life annuity?

A) Fixed annuity payment for a fixed term

B) Payment of annuity for as long as the annuitant lives

C) Annuity payment ceases on the annuitant's death

D) Lump sum payment to the beneficiaries on the annuitant's death

E) Return of the accumulated fund to the annuitant's beneficiaries

Q 14. What is one of the advantages of investing in an annuity?

A) Regular payment after retirement

B) Money gets blocked till retirement

C) Provides financial independence

D) An option for diversifying the portfolio

E) Immediate payment option

Q 15. What is the main characteristic of group insurance schemes?

A) Insurance coverage for a group of people under one master policy

B) Individual choice of coverage amount

C) High administrative costs

D) Adverse selection risk

E) None of the above

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