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Page 1: IC – 33ic33exam.weebly.com/uploads/1/4/9/9/14995008/ic_-_33_english.pdfLIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002

LIC VASANTHAM GUIDE : | [Type the company address]

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Website : www.ic33exam.weebly.com

IC – 33

QUESTION BANK

COMPILED BY :

R.MANAVALAN,

DEVELOPMENT OFFICER,

L.I.C. OF INDIA, TALLAKULAM BRANCH,

MADURAI - 625 002.

MOBILE NO : +91 9443472469

Page 2: IC – 33ic33exam.weebly.com/uploads/1/4/9/9/14995008/ic_-_33_english.pdfLIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002

Website : www.ic33exam.weebly.com

LIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002. MOBILE NO : +91 9443472469

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Page 3: IC – 33ic33exam.weebly.com/uploads/1/4/9/9/14995008/ic_-_33_english.pdfLIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002

Website : www.ic33exam.weebly.com

LIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002. MOBILE NO : +91 9443472469

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PLEASE READ THE FOLLOWING INSTRUCTIONS CAREFULLY

1. The Test contains 50 questions to be attempted in one hour duration. 2. For all correct answers a candidate obtains 50 marks. There is no negative

marking for wrong answers. 3. For every question, four alternative options have been given on the

computer screen. The fifth option is “I am not attempting this question” while the correct answer is amongst the first four alternatives.

4. The candidate must ‘Mouse-click’ the alternative he feels appropriate/correct. The said alternative will be highlighted and shall be treated as the answer given by the candidate for the question. In case the candidate does not wish to attempt the question then he must ‘Mouse-click’ the fifth option i.e. “I am not attempting this question”.

5. After all the 50 questions are attempted, the candidate must click on “DONE” button at the bottom of the question paper to submit the questions. Once “DONE” button is clicked the answers are saved in the computer automatically.

6. The candidate can make changes in their choice of alternative only before clicking the “DONE” button. To move back and forth between the questions candidates can use the ‘scroll bar’. To recheck the answers, after attempting all the questions, click on the “Go Back” button.

7. After the expiry of one hour, the candidates will not be able to attempt any question or check their answers. The answers of the candidate would be saved automatically by the computer system even if he has not clicked the “DONE” button on the screen.

8. Score-Card/Result sheet will be displayed after a candidate submits the questions. The said Score-Card/Result sheet shall be printed and handed over to the sponsoring institute immediately after the examination is over. However, the Certificate of Passing the examination would be sent to him directly by post from the Institute.

9. The candidates are provided with a back up sheet by the Test Administrator. This may be used in case there is a power failure or the computer shuts down due to some technical reason. The back-up sheet must be handed over to the Test Administrator once the examination is over. The candidates

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LIC VASANTHAM GUIDE, R.MANAVALAN, DEVELOPMENT OFFICER, L.I.C. OF INDIA, TALLAKULAM BRANCH,MADURAI - 625 002. MOBILE NO : +91 9443472469

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would be compensated for any time loss due to power or system failure subject to the direction of the Test Aministrator.

10. The candidates have been given “Practice Test Questions” for practice purpose before they start answering the “Examination Questions”.

11. The candidates may ask the Test Administrator their doubts or questions only before the commencement of the test. No query shall be entertained after the commencement of the examination.

12. The candidates are requested to follow the instructions of the “Test Administrator” carefully. If any candidate does not follow the Instructions/rules, it would be treated as a case of misconduct/adoption of unfair means and such candidate would be liable for debarment from appearing at the examinations for a period as decided by the Institute.

START EXAM

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CHAPTER – 1 How the insurance market operates 1. Weekly premiums are generally collected for which type/range of plans (a) Bancassurance (b) Health plans (c) Micro Insurance (d) Term Insurance

2. Who is the customer of a Re insurer (a) High Net worth Individual (b) Insurance Companies (c) Licensed Insurance Agents (d) Non Government Organization

3. What facility do insurers use to cover risks beyond their exposure limits (a) Bancassurance (b) Reinsurance (c) Both a & b (d) Neither a nor b

4.Which market areas do Micro Insurance product concentrate (a) People with large families (b) people with low income (c) people employed with the government (d) people with high income

5. What are the benefits in investing in insurance plans ? (a) In Family Protection (b) Child education & marriage planning (c) Retirement planning (d) All of the above

6. What is IRDA & its Responsibilities (a) IRDA is a Government body formulated for policing the activities of Insurance companies (b) "Insurance Regulatory and Development Authority (IRDA) was constituted as an autonomous body in 1999 to regulate and develop the insurance industry" (c) IRDA is an independent body constituted to address the grievances of the insurance policy holder (d) None of the above

7. What is IRDA stands for & year of Incorporation (a) "Insurance Regulatory and Development Authority (IRDA) . The IRDA was incorporated as an autonomous body in April 1999" (b) Insurance Regulatory and Development Authority (IRDA) was constituted in 1956 (c) IRDA is an independent body constituted to address the grievances of the insurance policy holde (d) None of the above

8. Why is Insurance required (a) To Cover Risks of Life (b) To plan for Future goals (c) For Savings (d) All of the above

9. When was IRDA formed? (a) 2000 (b) 1999 (c) 2001 (d) 1998

10. Insurance company selling products through newspaper advertisements is called (a) Indirect Selling (b) Awareness (c) Direct Selling (d) Wrong Selling

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11. Sanjeev is an insurance expert who has rich experience in determining premium levels for product, what is his profile like (a) an actuary (b) loss adjuster (c) risk manager (d) underwriter

CHAPTER – 2 Risk and insurance 1. Law of large number helps Insurer to analyse which key area (a) Administrative expenses (b) in fixing the correct premium (c) to remove adverse selection (d) Non of the above

2. Which statement is correct? (a) lung cancer is peril and smoking is a hazard (b) smoking is peril and lung cancer is hazard (c) Both the statement is correct (d) Both the statement is incorrect

3. What is the death benefit if the person has multiple sums assured under different policies? (a) Sum Assured will be paid as total of all insurance plans (b) Sum Assured will be paid for only one plan with highest SA (c) No SA will be Paid. (d) None of the above

4. Which of the following risks are insurable? (a) Financial Risk (b) Non-financial Risk (c) Both are correct (d) None of them

5. Sahil & Vijay , both health status same, however Vijay was triggered with medicals. What are the reasons? (a) Difference in age (b) Difference in family health status (c) Difference in hobbies (d) All of the above

6. The type of risk that can be insured against is (a) Speculative Risk (b) Pure Risk (c) Pure & Speculative risk (d) Non Financial Risk

7. In insurance terms, the risk of suffering a disability is best described as what type of risk? (a) Financial. (b) Fundamental. (c) Homogenous. (d) Speculative.

8. Insurance is a mechanism of (a) Retention of risk (b) Transfer of Risk (c) Avoidance of Risk (d) Reduction of risk

CHAPTER – 3 Insurance principles & Insurance practices

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1. A client has taken an endowment policy with SA- 800000 and vested bonuses- 60000. He paid 8 annual premiums in the 30 year plan. Calculate paid-up SA? (a) 89,333 (b) 273,333 (c) 289,333 (d) 219,333

2. When does cooling off period begin in an insurance policy? (a) When risk commences (b) When proposal form filled (c) When policy received (d) When premium is paid

3. When is insurable interest required in an life insurance contract? (a) At inception of the policy (b) At the time of maturity proceeds (c) At time of claims (d) At time of outset and claims

4. A claim intimation leads to the publishing of an advertisement in the newspaper. This means (a) Policy is assigned (b) Policy document is lost (c) Policy is in lien (d) Any one of the above

5. A policy has two nominations. What amount should be given to the two nominees (a) 10% to each nominee (b) 25% to each nominee (c) Nominee one should not be paid more than nominee two (d) There is no specified limit like that

6. Mr. X is illiterate and is buying insurance. Mr. Y fill up the proposal form on behalf of Mr. X and also endorses and signs an attestation in the proposal form. In addition to all document what else should be taken (a) Mr. X photograph (b) Mr. Y photograph (c) Mr. X thumb impression (d) Mr. Y thumb impression

7. On Maturity of an insurance policy only 25% of the amount can is paid. This is due to (a) It is assigned (b) It is a money back policy (c) It is paid up (d) Any one of the above

8. A person paying 1 lakh yearly premium discontinue the policy after the first year premium and surrender the same on the second year what will be the surrender value (a) Premium Return (b) Premium with Interest (c) Premium less charges (d) Nothing as surrender is not allowed before 5 policy years

9. Jay buys a policy on the life of Nazia. Who is Jay? (a) Life Assured (b) Nominee (c) Proposer (d) Appointee

10. A Client can reject a policy after how many days of receiving the same. (a) 30 (b) 15 (c) 50 (d) 20

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11. For Logging a policy which document is more preferable Baptism Certificate or Ration Card as age proof? (a) Ration Card (b) Baptism Certificate (c) Elder Declaration (d) Voter card

12. The risk commencement date of policy is (a) After the U/W process (b) Premium receipted (c) Policy is dispatched (d) policy is received

13. Principle of Indemnity applicable to (a) Life Insurance (b) General Insurance (c) Both a & b (d) Neither a nor b

14............ is the basis of contract (a) Policy bond (b) Proposal form (c) Premium (d) Health report

15. A & B in enters into a Contract & B accepts the Contract with a condition. Will this be considered as a Contract Between A & B? (a) "Contract is created only when the acceptance is unconditional." (b) "Contract is created only when the acceptance is conditional." (c) Both are Correct (d) Both are Incorrect

16. The condition that the policy holder should pay the premiums regularly is mentioned in (a) Policy document (b) Prospectus (c) Proposal form (d) All of the above

17. The insurance cover Starts after the issue of (a) Policy Document (b) First Renewal Receipt (c) First Premium Receipt (d) None of the above

18. Except Surrender, how one policy holder can transfer money to a third party , barring Nominee? (a) By Will (b) By doing Assignment (c) Claim (d) not possible to transfer

19. Insurance Contract without any Insurable Interest will result? (a) Wagering Contract (b) Legal Contract (c) Void Contract (d) All of the above

20. A Policy holder takes a insurance contract for 30 years and the SA reduces after 25 years what could be the likely reason (a) No bonus accumulated (b) Age proof was substantially wrong (c) Policy has become paid up (d) Its a ULIP Plan

21. Amit is illiterate. He wants to take policy his friend Surya help him in knowing the question and filling the proposal form. What extra requirement is required in this case (a) Amit photograph (b) Amit thump impression Only

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(c) policy document need to be registered (d) Left thumb Impression of Amit along with a declaration of his friend

22. A life insurance policy can only be made paid up if what particular policy feature exists? (a) Indexing contribution. (b) Nomination facility. (c) Rider benefits. (d) Savings element.

23. Appointee's role (a) Signature on the proposal (b) Medical exams (c) insurable interest (d) when Nominee is Minor

24. Harish takes a life insurance policy for Ramesh. Which of the following statement best describes the principle of Insurable Interest. (a) Ramesh declares all his liabilities (b) Ramesh is elder than Harish (c) Ramesh owes money form Harish (d) Harish suffers financial loss incase of death of Ramesh

25. Limit of nominees can be attached to a term insurance policy (a) one (b) two (c) three (d) not specific

26. In a whole life plan - The policyholder's responsibility to give disclosure (a) at the beginning of the contract (b) through out the contract (c) Revival stage (d) both a & c

27. Mr. ABC buying Term insurance policy, insurer should mention Ombudsman address in which part of policy document? (a) operative clause (b) Preamble (c) Information statement (d) schedule

28. Reasons for surrender of the policy (a) SA (b) advisor induced (c) no commission (d) Has Financial Problems

29. To be a valid contract ,the declaration is necessary in which document (a) Policy Document (b) proposal form (c) FPR (d) RPR

30. Types of assignment (a) Absolute (b) Term assignment (c) Conditional (d) Absolute & Conditional

31. what is the min age to enter into the contract of insurance (a) 16 (b) 18 (c) 20 (d) 21

32. why does an insurer insist on age proof document . To assess (a) SA (b) Risk assessment (c) Identity verification (d) Financial assessment

33. A policy document for a money-back policy includes the statement ‘the proposal and declaration signed by the proposer form the basis of the contract’. In which main section of the

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policy document will this normally appear? (a) Attestation. (b) Operative clause. (c) Preamble. (d)Terms and conditions.

34. Changes in policy can be made by (a) Issuing a new policy (b) Endorsement (c) Corrections on the policy (d) Not allowed

35. If someone of age group 15 /16 having a contract with insurance companies that contract would fall under which category (a) Valid (b) Invalid (c) Void (d) Illegal

36. The obligation of the insurer for the whole life policy is mentioned in (a) operative clause (b) Preamble (c) Provison (d) Endorsement

37. Husband and wife jointly taking insurance policy what is the reason that they need not mention nominee under this insurance policy (a) Whole life (b) Return of premium (c) Joint Life Policy (d)Endowment policy

38. In which kind of policy the insurable interest should exist at the time of claim only (a) Motor insurance (b) Marine insurance (c) Liability insurance (d)Travel insurance

39. Indisputability clause is applicable for (a) 6 months (b) 12 months (c) 2 years (d) 5 years

40. Insurable interest on one's own life limited upto (a) 20 times of Gross Annual income (b) Liabilities (c) Assets (d) Unlimited

41. Two endowment policies A and B are issued in the same time on the quarterly mode. In both the policies 22 quarterly installments are paid. Both are surrendered immediately after paying 22nd installment. But in policy A surrender value is significantly higher than policy B because (a) Term of A policy is higher than B policy (b)Term of B policy is higher than A policy (c) Policy A is assigned and B is not assigned (d)Policy B is assigned and A is not assigned

42. What is the minimum age of the customer for entering the Insurance contract? (a) 16 years (b) 17 years (c) 18 years (d) 21 years

43. When will the Principle of Utmost Good faith apply in Term insurance plan? (a) Throughout the policy contract (b) before premium deposit (c) before receiving policy document (d) After receiving the policy document

44. A policy was earlier issued with premium extra, where are the details of the customer available (a) Proposal form (b) Medical reports (c)Client confidential reports (d)Medical referees report

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45. An agent surrendered the policy of a client on 10 Feb. 2011, when can this client buy new plan? (a) 2014 (b) 2012 (c) 2013 (d) Anytime

46. When does insurable interest exist? (a) A inception of the contract (b) At claims (c) at survival benefits (d) Through out the term

CHAPTER – 4 Insurance underwriting

1. While underwriting Mr. X proposal form it is found out that there is a criminal case against him for fraudulent activities. What type of risk would this fall in (a) Fundamental risk (b) Physical hazard (c) Moral Hazard (d) No Risk

2. How much insurance can be given to a working person ? (a) As per Human life Value (b) 10L (c) 50L (d) 1 Crore

3. While calculating Human life value (HLV) two components need to be kept in mind , the one is take home salary and other is (a) Bank Fixed deposit rate (b) discount rate (c) Estimated life expectancy (d) Estimated amount at retirement

4. Two People with same term, one person had more premium than others because (a) Married (b) Wife Younger (c) Health deterioration (d) Dirrerence in caste

5. Two friends have taken same policy but their premiums are different . Why ? (a) Age (b) Medical (c) SA (d) ALL THE ABOVE

6. In a 20 year with profit policy, persistency Bonus is paid at the end of (a) 1 year (b) 10th year (c) 15th year (d) 20th year

7. Which of the following statements is correct? (a) Smoking invites extra premium (b) Drinking invites extra premium (c) None is correct (d) Both are correct

8. Till what period is the interim bonus valid (a) as long as the policy is inforce (b) Till the next declaration of bonus (c) Till the next validation date (d) none of the above

9. Annual premium of insurance product is Rs. 32,000, 4% loading on Quarterly mode of payment What is the quarterly premium? (a) 7680 (b) 8000 (c) 8320 (d) 8500

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10. As per the norms of risk assessment by U/W both the parents of a policy holder died in their early 30s due to Heart disease, what is the risk assessed (a) Moral Hazard (b) Medical Hazard (c)Occupational Hazard (d)Physical Hazard

11. Investment by NRI(Non Resident Indian) will be (a) No risk (b) Low risk (c) Medium risk (d) High risk

12. Mr.Sunil is doing premium calculation for his company, as per which authority is his profession related to (a) Council of Actuaries (b) Insurance council of India (c) Insurance institute of India (d) IRDA

13. what is the special report that is asked by the underwriter from the officer of the insurer (a) HLV report (b) Client confidentiality report (c) moral hazard report (d) medical report

14. why ACR required? (a) To calculate Premium (b) To Calculate the commission due for the agent (c) To verify the Plan proposed (d) To help the underwriter to asses the Risk

15. A human being is (a) An economic asset (b) Has a capacity to generate the income (c) Has a finite life span (d) All of the above

16. Claim was settled however full Sum assured not paid though the policy was in force due to (a) Lien (b)Bonus (c)Surrender (d)Accidental death

17. Mr. A wants insurance cover . But he is drinks alcohol frequently . What kind of hazard you may categorize? (a) Physical hazard (b) Moral Hazard (c)financial risk (d)Pure risk

18. Insurer appoints a candidate of this professional qualification ,who decides the amount of premium in insurance products (a) Actuary (b) Underwriters (c) Sales Officer (d) Advisor

19. Proposal decision to be communicated to the client with in (a) 7 days (b) 10 days (c) 15 days (d) 30 days

20 When an interim bonus is paid under with profit policy, This normally represents a bonus covering what period

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(a)Policy start date to the 1st Anniversary (b)Policy start date to the end of the 1st calendar year (c) Previous valuation date to claim date (d) claim date to next valuation date

CHAPTER – 5 Basic life insurance products

1. What tax rate, if any, will be applicable to a life insurance policy holder for the maturity proceeds of a Rs 50,000 life insurance policy (a) Nil (b) 0.1 (c) 0.2 (d) 0.3

2. What is maximum level of Insurance premium for which Income Tax benefit is available (a) 25000 (b) 50000 (c) 100000 (d) 150000

3. Who is the primary underwriter of the clients (a) Insurer's doctor (b) Underwriter (c) Agent (d) Nominee

4. Mr. X wants a life cover for the term of 20 Yrs. Also he wants a modest amount if he survives through the term. Which plan should he buy (a) Term Plan (b) Endowment plan (c) Convertible plan (d)ULIP

5. In which policy can policy holder take loan ? (a)Health Policies (b)Term Policies (c)Endowment Policies (d) All of the above

6. Which plan will suits a customer need who is just looking for protection of family. (a) Term Insurance (b) ULIP (c) Endowment (d) Moneyback

7. If 50000 is invested in Single Premium ULIP than what will be the minimum SA applicable? (a) 50000 (b) 75000 (c) 62500 (d) 100000

8. What is the maximum cover that can be provided in micro insurance? (a) 5000 (b) 10000 (c) 50000 (d) 100000

9. State which of the following statements are correct? (a) In ULIPs riders can be attached (b) In ULIPs death benefit will be the basic SA only (c) both statements are correct (d) Both statement are wrong

10. Mr. A has a son who is 5 yrs and he wants to save funds for his education. Both the parents are risk adverse. Which plan is suitable for them? (a) Convertible plan (b)Term Insurance (c)Endowment Plan (d)ULIP Plan

11. A Couple has 7 year kid & wants to Buy some Policy. Which is the best suitable policy for his Son? (a) Only ULIP Plans (b) Only Endowment Policies (c) only Term Plan

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(d) Child insurance plans can be taken out in the form of endowment plans, money-back plans or ULIPs

12. Ajay is 35 years old and works for a multinational corporation (MNC). He has a ten-year-old son, Vijay, whom he dreams will one day become a doctor. Ajay’s spouse is a housewife, and his parents are retired and dependent on him. Ajay has a home loan of 40Lakhs. He has an endowment plan with a cover of 2Lakhs only. What is most immediate need for Insurance (a) term plan (b) health plan (c) endowment plan (d) traditional plan

13. Client has taken Joint Life Policy.. Whose responsible in the contract? (a) Insurer (b)Proposer (c)Proposer & Wife (d)Insurer and both the Life Insured

14. If a person has taken a Pure Endowment Policy, then what will be the death benefit if he dies during term of policy? (a) No Death Benefit(b) Sum Assured will be paid (c) Both are correct (d) both are incorrect

15. Two People of the same policy Term, one person pays more premium because (a) Married (b) Wife Younger (c) Health deterioration (d) Higher Age

16. Micro insurance is transacted by (a) Life Insurers only (b)Non-Life Insurers only (c)non-life and life insurers (d)None of them

17. Adverse selection occurs when a group of individuals try to (a) cover only particular members of the group (b) to cover all members (c) have uniform coverage (d) None of the above

18. If raju wants to accumulate a lump sum for 20 yrs but does not require life cover, which policy will be suitable? (a) Term insurance plan (b) Money back (c) pure endowment policy (d) Whole life

19. In a joint life plan for a husband & wife, where should the agent' principal loyalty lay? (a) Insurance company (b) Husband only (c) Husband & wife (d) Insurance company, husband & wife

20. Hari wants a constant life cover till his 31st birthday. But he cant afford to pay high premiums. The best suited products for him would be (a) Pure Endowment (b) Anticipated endowment (c) Term plan (d) ULIP

21. what is the special feature of ULIP that ensures customer risk profile for long time insurance policies (a) fund switching (b) partial with drawl (c) premium holiday (d) riders

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22. At the time of maturity , quarter of the SA is paid though the policy was in force (a) Endowment (b) Lien (c) Money back (d) Surrender

23. Rahul has taken a joint life policy with his wife .Who is responsible for premium payment ? (a) Rahul (b) His wife (c) children (d) Both a & b

24. Krishna and Laxmi are married having 7 years old child. Which policy will satisfy the long term protection needs for both (a) Endowment (b) Money back (c)Term Insurance (d)Child Investment policy

25. Term insurance if best suited for the following need (a) home loan (b) education need (c)marriage of kids (d)Retirement needs

26. A group of people insured in a policy . They belong to which category (a) Same Age (b) Employees (c) Family (d) Acc to height

27. In endowment policy we give SA + Bonus- (a) Outstanding premium (b) Commission outstanding (c) Both of the above (d) None of the above

28. Which factor needs to be kept in mind before deciding a child policy ? (a) Mode of the premium (b) Inflation (c) Maturity Value (d)Vesting Age

CHAPTER – 6 Savings products

1. Suresh wants to transfer his physical gold to gold exchange traded fund, in relation to access, this change will (a) Increase his liquidity (b) Decrease his liquidity (c) Reduce his encashabilty for next six months (d) Create a future exit liability

2. ULIP & NSC which is giving more tax benefit (a) ULIP (b) NSC (c) Both with same benefit (d)None of them having any tax benefit

3. The advantage/disadvantages within cumulative and fixed traditional deposits pertain to- (a) Returns (b) Taxation (c) Look-in Period (d)Investment Frequency

4. Ajay is 35 years old and works for a multinational corporation (MNC) Ajay salary is 80,000 he want home lone. what is maximum installment? (a) 8,000 (b) 16000 (c) 24000 (d) 32000

5. ULIP & NSC which is giving tax benefit u/s 80C (a) ULIP (b) NSC (c) ULIP & NSC (d) None of them

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6. Under which section of the Income Tax Act can an individual get a deduction from taxable income for the (a) Sec. 80D (b) Sec. 80C (c) Sec. 80E (d) Sec. 80F

7. What period of time a client has to be invested to get tax benefit under postal scheme? (a) 10 Years (b) 8 years (c) 6 years (d) 5 years

8. If a person is going to face jobless for a temporary period, then what is the ideal instrument to invest money apart from Bank FD? (a) Debt Funds of MF (b) NSC (c) Corporate bonds (d) Govt Bonds

9. Mr. X Invested in a Bank FD with 6% Return, However his actual returns deemed to be 4% What are the reasons ? (a) Inflation (b) Charges (c) Current Market Scenario (d) All of the above

10. A person planning to invest in Kisan Vikas Patra will go to (a) Insurance Branch (b) Post Office (c) Internet (d) Mutual Fund Office

11.A person Wants to invest in a FD for Tax benefit , How many years he has to take the term of the FD ? (a) 5 year (b) 4 year (c) 3 Year (d) 2 Year

12. aditya wants to take home loan and his monthly take home is 80,000 what as a best practice should be the maximum EMI (a) 20000 (b) 24000 (c) 28000 (d) 32000

13. A customer while investing in to Recurring deposit or Cumulative deposit what are the key factors which will matter (a) Taxation (b) frequency of payment (c) interest rates (d) tenure

14. A person is holding 100 units of GOLD ETF certificates . How many grams of GOLD does he Have ? (a) 10- 20 gms (b) 20- 50 gms (c) 50-100 gms (d) 10 gms

15. Manoj a 26 year old is having 7 years old son. What will happen to his monthly disposable income after 15 years of job (a) Marginally decrease (b) Significantly increase (c) less than after 15 years (d) will remain same

16. Ramesh has invested in Post office Monthly Income Scheme. The interest rate was set at 6%. What will be the effect of rate till the maturity. (a) Increase gradually (b) Decrease gradually (c) Remain Constant (d) Change as per market fluctuation

17. If a person chooses Cumulative deposit than Recurring deposit ,difference will be in (a) frequency of interest calculation (b) Tax (c) Interest tax (d) Tenure

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18. Kishan Vikas 's payment gets cleared at (a) Bank (b) Post office (c) Insurance company (d) Any one of the above

19. RBI increased interest rates 2 times, then the stock prices will (a) increase (b) decrease (c) volatile (d) same

20. Rahul switch from direct holding of shares to equity based mutual funds. The impact on risk would be (a) Less transparent (b) More diversified (c) Less return (d) Steep rise

21. Raj and akshat of same age are paying the same annual premium for the health policy taken on the same date for the same term. But raj is getting higher deduction for income tax as compared to akshat (a) Raj is married and akshat is single (b) Raj is above 65 years and Akshat is below 65 yrs (c) Raj is in the good health and akshat is in poor health (d) Raj is earning more and akshat is earning less

22. Raj is married with two children. Age 9 and 11 years. What should be the last priority for him among the life, health , retirement and child investment policy (a) Life Insurance (b) Health Insurance cover (c) Retirement plan (d) Child Investment policy

23. What is the frequency of interest in Cumulative deposit account (a) Monthly (b) Quarterly (c) Half Yearly (d) Yearly

CHAPTER – 7 Other key financial products

1. What is the amount of money a client can take out as a lump-sum from a pension policy? (a) One-tenth (b) one-third (c) one-fifth (d) half

2. Omkar Started a pension policy with provider A but ended up in taking the annuity payment from provider B.The result directly reflect the which feature available with this policy (a) Commutation Option (b) Differed Annuity Option (c) Guaranteed period option (d) Open Market option

3. Denny is married and has 2 children age 6 and 10. His parents are alive and are 70 and 68. Who all can be included under the family floater health plan (a) Denny only (b) Denny and his wife (c) Denny, His wife and children (d) Denny, His wife and children and parents

4. Critical illness rider was taken and the rider benefit has been claimed , the rider benefit now gets (a) Reduced the base SA (b) terminated (c) continues as it is (d) will discontinue for 1 months

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5. In a Guaranteed annuity option of 5 years , the policy holder will get annuity till (a) entire life term (b) till 5 years and continue till annuitant lives (c) annuity only for 5 years (d) None of the above

6. What frequencies can one take in annuity (a) monthly,quarterly,half yearly, yearly (b) fortnightly,quarterly,monthly,yearly (c) fortnightly, monthly ,half yearly, yearly (d) None of the above

7. Why is there a waiting period in health insurance policies? (a) Pre-existing illnesses (b) Change in premium terms (c) Nature of risk (d) Cooling off period for insurers

8. How is No Claim Bonus is given in a Health Insurance Policy (a) By way of Cash Discount (b) Discount in Renewal Premium (c) Free Renewbality (d) Free increase in Sum Assured

9. What is importance of Health insurance? (a) meet any medical emergencies (b) Major hospitalisation and treatment expenses (c) meet expenses post hospitalisation due to loss of income (d) All of the above

10. A person retiring within 3 months need return as pension. What kind of investment plan he need to choose. (a) Immediate Annuity (b) Deferred Annuity (c) Anticipated Endowment (d) ULIP

11. An individual need a lump sum at the age of retirement, the amount he need to invest annually for the goal will depend on (a) the deferment period (b) amount which required (c) investment tools used for investment (d) All of the above

12. What are the Special features of Health plan? (a) Covers disease expenses (b) Helps in Tax Benefits (c) covers hospitalization cost (d) All of the above

13. What will be maturity benefit under health insurance plan (a) Fund value (b) Paid premium (c) Paid premium with interest (d) No maturity benefit

14. Which is the suitable savings plan for a senior citizen (a) Term insurance plan (b) Money back (c) ULIP Plan (d) Pension plan

15. Claim Amount received under CIBR Rider ,can be spend for (a) Health Expenses Only (b) Household expenses Only (c) Unspecified reason (d) to pay the further premium of base plan

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16. What could be the percentage of guaranteed return in all ULIP pension plan. (a) 0.06 (b) 0.085 (c) 0.045 (d) 0.1

17.A person has taken a term insurance of 4 Lac. What is the maximum Critical Illness Rider he can take (a) 1 Lac (b) 2 Lac (c) 3 Lac (d) 4 Lac

18. commutation is a feature of which type of policy (a) annuity (b) joint life policy (c) pure endowment policy (d) policy of another person

19. Mr. Sharma buy term insurance policy along with Accident and Disability benefits rider cost restricted upto the base premium of the policy? (a) 20% (b) 30% (c) 40% (d) 50%

20. Mr.Ramesh invested Rs:50000 in pension policy, what is the percentage he can avail as exemption in Income tax. (a) 33.33% (b) Pension plan is not eligible for tax exemption (c) 1 (d) will depend on his income slab

21. Mr.Sumesh takes a policy and pays premium of 20000 with a sum assured of 300000, what will be the tax implication on his maturity amount (a) Fully taxable (b) 10% (c) 20% (d) Tax fully exempted

22. Yash wants to take open market option in Pension plan. What is the benefit? (a) save more tax (b) switch the underlying fund (c) improved annuity rate (d) To continue life cover

23. In rising life expectancy the need for pension policy is increasing as retirement planning is (a) Less expensive (b) Less Transparent (c) More necessary (d) Tax efficient

24. Ramesh wants to buy 15 years pension plan for retirement while calculating gaps required at the end the gratuity amount was completely ignored because he is (a) self employed (b) Widower (c) Savings are significantly higher (d) Govt employee

25. While calculating pension figures, required at the time of retirement, two factors should be considered while planning, One is taxation and other is (a) Health (b) Charges (c) Inflation (d) Interest rates

26. A invested money in Sr Citizen scheme. What is the tax benefit he receives? (a) Amt will be deducted from taxable income upto 1 lakh (b) Rs 1000 will be deducted (c) 10% of the amt will be deducted (d) 20% of the amt will be deducted

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27. If Rs.30000/- has been invested in insurance for tax benefit than how many years does one have to wait for maturity ? (a) 5 YRS (b) 10 YRS (c) 7 YRS (d) 3 YRS

28. Mr.Arvind has 2 children aged 13 & 15, he wants to buy 2 health plans, one for himself & one for his wife, what will you recommend. (a) Family floater (b) Health plan (c) Endowment plan (d) Term Plan

29. Which fund needs to be selected to receive a 4.5% guarantee on Pension ? (a) ULIP (b) ENDOWMENT (c) POST OFFICE (d) BANK

CHAPTER – 8 Identifying client needs

1. In which of the recognized life stages an individual does not required any protection cover (a) Childhood (b) Young Married (c) Pre Retirement (d) Retirement

2. Mr. X fact find shows he need a term insurance for his future income protection, A family health plan to cover medical needs, a children's plan to cover his son's education and a endowment policy for his daughter's marriage. Which of these is the first priority (a) Term Insurance (b) Medical Insurance (c) Children's Policy (d)Endowment Policy

3. With profit policies can be given to (a) surety (b) keyman (c) partner (d) Individual 4. 4. 4.Why need do self employed people have to buy medical insurance than that of a person employed with a public sector company (a) Public sector employees do not get sick very often (b) public sector employees enjoy medical cover related to the Job (c) Self employed person fall sick quite often (d) Self employed person give more priorities to health

5. A family consisting of husban,wife and two children aged 6 and 10 what kind of insurance plan can be suggested ? (a) Protection plan (b) child plan (c) Saving plan (d) All of the above

6. Rajiv is married & has 4 year old son. Which insurance plan is suitable for him? (a) Child plan (b) convertible plan (c) pension plan (d) ULIP Plan

7. What to be considered while taking first policy (a) Personal Details (b) Family Details (c) Employment details (d)All of the above

8. Samir is married and he has only one partner, with dependant parents and no child, which should be his priority

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(a) income protection (b) inheritance planning (c) investment efficiency (d) long term savings

9. The sole focus during a client’s fact-find session was healthcare requirements and estate planning. Which main life stage is he most likely to fall into? (a) Young married couple (b) Young married with children. (c) Pre-retirement. (d) Retirement

10. The main protection need of a 19-year-old is most likely to be (a) self-protection. (b) home loan protection. (c) protection of Dependants. (d) protection of children’s future.

CHAPTER – 9 The fact-find and financial planning

1. Benefit Illustration given to a customer quantifies an amount by which investment return is reduced. This reduction reflect the impact of (a) Charges (b) Interest (c) Inflation (d) Taxation

2. Fact Find Process helps to (a) Ensure a sale is achieved (b) Identify Client need (c) Create an audit trail for future complaints (d) Provide regulatory body about agents data base

3. A Person Need to do Estate Planning when (a) Young Person (b) 30-40 years age group (c) Married (d) About to get retired

4. Which plan should an agent suggest (a) A Plan based on needs to the Client (b) A plan based on paying capacity of the client (c) A Plan based on the clients dreams (d) None of the Above

5. In a fact find, a couple discovered their need to be estate planning? In what life stage will they be in? (a) Married (b) Married with children (c) Married with older children (d) Retirement

6. Mr. Prasanth 25 Age Govt: job, Bachelor - how many years policy can be given (a) Short term (b) long term (c) As per his goal (d) both b & c

7. Sanju & vikram are both 22 yrs old. Sanju has dependent parents and vikram has no dependants. What will be sanju’s preference over vikram’s preference? (a) Investment (b) Health Insurance cover (c) Life insurance cover (d) No preference

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8. A Couple has 7 years old son, What solution would they be looking for (a) Retiremen (b) health care (c) child education (d) life cover

9. The commission payable in a ULIP plan to the Advisors is mention in... (a) Illustration benefit (b) Premium receipt (c) Product Brochure (d) Proposal Form

10. An agent has recommended an investment product with non-guaranteed benefits. The benefit illustration passed to his client will therefore use assumed annual growth rates of (a) 5% and 8% (b) 5% and 10% (c) 6% and 8% (d) 6% and 10%

11. The rates of assumed annual growth to be shared in the benefit illustration has been decided by which of the authority (a) IRDA (b) Life insurance council (c) The Royal Bank (d) SEBI

12. While recommending a solution to the client, the advisor should, establish the link between, client needs and (a) Advisor need (b) Product feature (c) Client income (d) Client expenditure

13. A 38 year old married with 2 children, her husband dies and left huge legacy behind. What should be top priority? (a) estate plan (b) loan protection (c) pension (d) wealth creation

14. A young couple wants to invest for their daughter, and their income will increase with time horizon and suggest investment plan? (a) term plan (b)endowment (c) annuity (d) flexible plan

CHAPTER – 10 Good client practice

1. The best way to prove that customer of a ULIP policy is given awareness about the commission paid to the agent is (a) Ask the insurer to give a policy endorsement letter (b) From the fact details (c) From signed copy of benefit illustration (d) From ticked columns of proposal form

2. An agent should disclose the commission if (a) the commission is low (b) the commission is high (c) Customer asks for it (d) customer not asks for it .

3. An agent reveals the commission received from Insurance sales to X and Y. Both are for the same duration. Why is commission of X far higher than commission received for Y (a) Only X has bought other product from the agent (b) Only Y has a Single premium Product (c) X is married and Y is Single (d) Y is young

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4. Nikhil explaining ULIP plan to a customer doesn't know answer of a doubt regarding the product that the customer has. What should he do? (a) Ask the customer to check it himself (b) tell him what ever he thinks (c) Refer to the product brochure (d) must not shown any interest in the doubt

5. Churning is considered bad for a customer. Why is it? (a) Impact of charges on customer fund (b) Higher commission to advisor (c) Both a & b (d) Neither a nor b

6. What is the reason , that an advisor is getting more than 35% Commission in the 1st Year? (a) Not possible (b) Alternate channel (c) Mis-selling (d) Higher charge products

7. Churning is bad , based on which aspect (a) Agents earn Lower Commission on churning (b) Policyholder gets more benefits (c) Policyholders suffer due to surrender charges and benefits (d) Insurance companies get good branding

8. Higher persistency to the insurer ensures what ? (a) More productivity (b) Higher attrition (c) Higher Profits (d) Higher S.A

9.Persistency =has increased from 82 % in previous year to 86 % this year . That means (a) more lapsation (b) more attrition (c) less lapsation (d) No profits

10. A satisfied client will lead to (a) Word of mouth publicity for the agent (b) Chances of up selling (c) More reference generation for the agent (d) All the above

11. An Agent can receive maximum of ________ %of the premium as commission in the first year (a) Thirty Percent (b) Twenty percent (c) Thirty Five Percent (d) None of this

12. Customer asks the agent to disclose the commission . The agent should (a) disclose on demand (b) Not disclose (c) Should call up the Insurer (d) Should avoid the topic

13. If Sales Target get reduced then Churning will (a) Increase (b) Decrease (c) Will not affect (d) Partially

14. Advisor motivate the client to surrender the existing Endowment plan and buy new Whole life policy for gaining higher commission, is the example of? (a) switching (b) Building long term relations (c) Revisit the financial planning (d) Churning

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15. An advisor will do a churn to (a) Avoid a customer complaint (b) Minimize paper work (c) Service the customer (d) To earn extra commission

16. What are the key aspects of advisors do for better persistency? (a) Selling product as per need & policy servicing (b) Surrender (c) Selling products having higher Commission (d) Not keeping in touch with client

CHAPTER – 11 Claims

1. If a person is missing then after how many years will he be considered as dead & SA paid to the nominee. (a) 5 (b) 7 (c) 10 (d) 12

2. What is the death benefit if the person has multiple sums assured under different policies? (a) Death Benefit will be the amount with highest SA policy (b) No amount will be paid (c) Sum of all SA in different policies (d) Not more than 20 lacs

3. Client died in 89th day from DOC. In which category he is not eligible for claim (a) Murder (b) Deep Illness (c) Accident (d) Suicide

4. Mr. Customer has taken a policy and died before receiving the document which was dispatched by the insurer. (a) Entitled for full claim (b) Entitled for partial claim (c) Not entitled (d) Return of Premium

5. In a claim, the customer got much more than the Sum Assured. Why? (a) Nature of payment (b) Investment Frequency (c) Nature of Death (d) Survival Benefits

6. Without submitting any form of claim, a life insurance policy holder received payments of maturity then what type of policy he is holding (a) ULIP (b) Term (c) Money Back (d) Health

7. If a person is absconding then after how many years will he be considered as dead & SA paid to the nominee. (a) 10 years (b) 20 years (c) 7 years (d) 12 years

8. No of days in which the death claim has to be paid after the necessary documents have been received (a) 15 days (b) 30 days (c) 45 days (d) 60 days

9. Mr.Suresh dies one day before the grace period without paying the premium, what is the claim payable (a) No claims payable (b) All premiums paid (c) Sum assured (d) Sum Assured less the undue premium

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10. The delay in settling claim by any insurance co, as per IRDA norms has to pay....% if the present bank interest rate is 5.2% (a) 7.00% (b) 8.50% (c) 7.20% (d) 8.20%

11. What is the maximum Time in which The insurer should settle a claim when all documents are submitted (a) 3 days (b) 15 days (c) 30 days (d) 10 days

12. During claim insurer deduct Rs. 10,000 in spite of having no Lien and all due premiums are paid. What are the other reason for deducting the same? (a) Premium Rate increase (b) Loan facility (c) Mode of Payment (d) Loading

13.In case of confirmed accidental death, the benefit is paid in the form of (a) Life time annuity (b) Lumsum sum assured plus accidental sum assured (c) Sum Assured (d) Lump Sum plus life time annuity

14. Under Indian Evidence Act 1872, after which year presumption clause will apply if the person is not heard of (a) 6 years (b) 7 years (c) 10 years (d) 12 years

CHAPTER – 12 Legislation and client advice

1. Which institution was incorporated by the Insurance Act 1938 (a) Insurance Institute of India (b) Insurance brokers association of India (c) Life Insurance Council (d) None of the above

2. License of candidate passing insurance exam is valid for ___ years? (a) 1 (b) 3 (c) 5 (d) 7

3. The controller of insurance in India is (a) IRDA (b) RBI (c) SEBI (d) Insurance ombudsmen

4. Who is regulating Advisor's Licencing (a) IRDA (b) Insurance Act 1938 (c) LIC Act 1956 (d) None of the Above

5. If the policy is endorsed under MWP Act - then the beneficiaries are wife and ? (a) parents (b) ex wife (c) children (d) mother

6. Consumer Forum at district level will hear complaints up to (a) 20L (b) 40L (c) 1Cr (d) 10L

7. Mr. ABC cleared the IRDA exam on 2010 got license but he did not work , In which of the year again he will apply for insurance license? (a) 2013 (b) 2014 (c) 2015 (d) 2016

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8. What is the Thresh hold limit of premium in cash insurance as per monetary policy? (a) 10000 (b) 20000 (c) 50000 (d) 100000

9.Who is regulatory body of money laundering in insurance sector? (a) SEBI (b) RBI (c) IRDA (d) TRAI

CHAPTER – 13 Regulation and client advice

1. Which is the training institute for providing training to insurance agents? (a) Insurance Institute of India (b) IRDA (c) RBI (d) SEBI

2. What is the eligible age for Life Insurance Agent? (a) 16 (b) 15 (c) 18 (d) 17

3. Board of Insurance is related to (a) SEBI (b) IRDA (c) Insurance Association (d) None of the above

4. basic qualifications of agent (a) sound mind & graduate (b) sound mind & good income level (c) Age and income level (d) His contacts in the market to solicit Insurance

5. Investment by foreign direct investors in to Insurance co's is restricted to (a) 12% (b) 25% (c) 49% (d) 26%

6. What is the role of National Insurance Academy? (a) To regulate (b) To advise Government (c) To undertake training activities (d) To Advertise globally on Indian Insurance

CHAPTER – 14 Customer protection

1. Karthik written to his insurer about non settlement of a maturity claim, as per regulations, the insurer has to reply to this within how many working days (a) 3 (b) 5 (c) 7 (d) 10

2. When was Ombudsmen Created? (a) 1998 (b) 1986 (c) 1989 (d) 1990

3. Insurance companies are required to honor the awards passed by the Insurance Ombudsman (a) 15 days (b) 10 days (c) 20 days (d) 3 days

4. Matters referring to ombudsman? (a) partial or total repudiation of claims by the insurer (b) dispute with regard to premium paid or payable (c) delay in settlement of claims (d) All the above

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5. Client rejecting after taking a policy in how many days.When the insured disagrees with any of the terms or conditions of the policy after the policy is issued, they have the option to return the policy stating the reasons for their objection. Within how many days they can return the poly? (a) 30 (b) 15 (c) 20 (d) 25

6. Consumer can call Toll free No. for any Grievance or he can also contact (a) Consumer Affairs Department of the IRDA (b) Insurance Ombudsman (c) Insurance Company (d) All of the above

7.What is the free look time available after receiving policy Documents? (a) 30 (b) 15 (c) 20 (d) 45

8. What is the limit of Ombudsman claim settlement? (a) insurance contracts of value not exceeding Rs. 20 lakhs (b) insurance contracts of value not exceeding Rs. 25 lakhs (c) insurance contracts of value not exceeding Rs. 30 lakhs (d) insurance contracts of value not exceeding Rs. 50 lakhs

9. Regulation issued by IRDA required that the decision on the proposal must be conveyed to the proposer within (a) 15 days (b) 20 days (c) 1 month (d) no time bar

10. Whom should customer contact in case of any dispute for a claim more than 20 lakhs (a) Forum at district level (b) Forum at state level (c) National commission (d) Ombudsman

11. Complaint council bodies other than IRDA grievance readdress forum & COPA (a) Ombudsman (b) Insurance Institute of India (c) Insurance Association (d) FERA

12. What are the ways by which a policy holder can make complaints (a) email (b) Toll free No. (c) Newspaper (d) Email or Toll free Number

13. what is the maximum level of complaint that can be considered and taken action by ombudsmen (a) 20 lac (b) 25 lac (c) 30 lac (d) 50 lac

14. What is the period of award passed to the customer decided by ombudsman? (a) 2months (b) 3 months (c) 5 months (d) 6 months

15. An Award is passed by Ombudsman .In how many days it should be honored by Insurance Co (a) 15 days (b) 30 days (c) 60 days (d) 90 days 16. If the complainant is disagreeing with the decision of the company on the claim then he can approach to ombudsman in (a) 1 month (b) 6 weeks (c) 12 weeks (d) 2 months

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CHAPTER – 15 Ethics and code of conduct

1. A policy has been rejected by the company under direct intimation to the customer and copy to the Agent, what is the next action of the Agent (a) He has to inform the customer that the co has broken relationship with the customer (b) He plans to change the plan (c) He has to explain the reasons for rejection to the customer (d) He takes up with the higher authorities

2. An advisor while explaining the policy and to sell he accepts to give a part of his Agents commission, what is the limits (a) 10% (b) 20% (c) He cannot offer any commission (d) He can offer up to 50%

3. Raju is a certified license holder under what circumstances he needs to hold his certified license with him that is issued by IRDA (a) when he sells term insurance (b) when he represents himself as another insurer (c) when he sells pension policies (d) under all circumstances

4. ___________ has laid down the Code of Conduct for all agents (a) Insurance Institute of India (b) Insurance Regulatory & Development Authority (c) Indian penal code (d) Reserve bank of India

5. Sushil was under tremendous pressure to achieve his target. He suggested a newly launched product to all his prospective clients, whether that product is suitable for them or not. He was able to convince two of his clients by only highlighting some of the good benefits and hiding certain vital details about the product. This behaviour of the agent could be described as

(a)ethical behavour (b) un ethical behavior (c) egostic behavior (d) aggressive behaviour

6. Which of the following will be considered as an unethical practice on the part of an agent?

(a) Reminding the policyholder well before the due date of renewal premium and ensuring regular payment of premium by the policy holder.

(b) Suggesting to clients only products that will help the agent earn a high commission irrespective of the fact that the product might not be suitable for the client.

(c) Advising the proposer to give correct and complete answer to all questions found in the proposal form.

(d) Assisting the policyholder in getting a change of nomination registered with insurer.