165
S.No Question Ans Option 1 Ans Option 2 Ans Option 3 1 an actuary loss adjuster risk manager 2 Promotional activities Drafting new regulations 3 12% 25% 40% 4 Which market does the Micro Insurance Concentrate on ? People with large families People with Low Income Government Employees 5 What facility do the insurer use to cover Risk beyond their Limits ? Re Insurance Banca assurance NGO 6 what is the max level under which micro insurance can be done 5000 25000 50000 7 Who is the customer of a Re insurer High Networth Individual Insurance Companies 8 Bancassurance Reinsurance TPAs 9 one policy has more SA ONE POLICY has more term 10 X is married 11 Customer asks the agent to disclose the commission . The agent should disclose on demand Not disclose Sanjeev is an insurance expert who has rich experience in determining premium levels for product, what is his profile like The Non Government organizations(NGO) helps the insurance industry immensely in Linking buyers and sellers Investment by foreign direct investors in to Insurance co's is restricted to Licenced Insurance Agents Insurance company transfers the insurance which cannot bear by them to a policy holder takes two insurance policy and the premium amount is identical and he gets lesser commission in one of contract the reason is likely to be one policy is a single premium An agent reveals his commission received from insurance sales to X&Y .Both plans are of same duration . Why is commission of X far higher that that of Y X has brought other limited premium product Y has brought a single premium product Should call up the Insurer

Practice Questions (1) (1)

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Page 1: Practice Questions (1) (1)

S.No Question Ans Option 1 Ans Option 2 Ans Option 3 Ans Option 4

1 an actuary loss adjuster risk manager underwriter 1

2 Promotional activities Drafting new regulations Linking buyers and sellers 3

3 Investment by foreign direct investors in to Insurance co's is restricted to 12% 25% 40% 26% 4

4 Which market does the Micro Insurance Concentrate on ? People with large families People with Low Income Government Employees 2

5 What facility do the insurer use to cover Risk beyond their Limits ? Re Insurance Banca assurance NGO RBI 1

6 what is the max level under which micro insurance can be done 5000 25000 50000 1 lac 3

7 Who is the customer of a Re insurer High Networth Individual Insurance Companies Licenced Insurance Agents 2

8 Insurance company transfers the insurance which cannot bear by them to Bancassurance Reinsurance TPAs Actuaries 2

9 one policy has more SA 3

10 X is married Y is Single 2

11 Customer asks the agent to disclose the commission . The agent should disclose on demand Not disclose Should call up the Insurer 1

Correct Ans

/ option

Sanjeev is an insurance expert who has rich experience in determining premium levels for product, what is his profile like

The Non Government organizations(NGO) helps the insurance industry immensely in

Linking third party administrators

people living in Metro cities

Non Government Organisation

a policy holder takes two insurance policy and the premium amount is identical and he gets lesser commission in one of contract the reason is likely to be

ONE POLICY has more term

one policy is a single premium

One of the policy has higher Premium

An agent reveals his commission received from insurance sales to X&Y .Both plans are of same duration . Why is commission of X far higher that that of Y

X has brought other limited premium product

Y has brought a single premium product

Should avoid the topic

Page 2: Practice Questions (1) (1)

12 From the fact details 3

13 Churning is bad , based on which aspect 3

14 what over riding criteria an insurance agent consider while proposing a solution risk suitability Flexibility Cost 2

15 Sales Target is reduced . Churning will Increase Decrease Will not affect Partially 2

16 Higher persistency to the insurer ensures what ? More productivity Higher attrition Higher Profits Higher S.A 3

17 more lapsation more attrition less lapsation No profits 3

18 3 days 15 days 30 days 10 days 3

19 A missing person is considered to be dead after 5years 8years 12 years 7years 4

20 7% 9% 7.20% 8% 3

21 15 days 10days 20 days 30 days 1

22 suicide murder Death was due to Accident Body not found 1

23 10% 20% 3

The best way to prove that customer of a ULIP policy is given awareness about the commission paid to the agent is

Ask the insurer to give a policy endorsement letter

From signed copy of benefit illustration

From ticked column of proposal form

Agents earn Lower Commission on churning

Policyholder gets more benefits

Policyholders suffer due to surrender charges and

benefits

Insurance companies get good

branding

Persitency =has increased from 82 % in previous year to 86 % this year . That means

What is the maximum Time in which The insurer should settle a claim when all documents are submitted

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 claim was submitted & in how many days company should ask for additional documents if required

Vivek takes insurance policy and dies after 8 months . If the claim needs to be excluded basis the exclusion cause what could be the cause

An advisor while explaining the policy and to sell he accepts to give a part of his Agents commission, what is th limits

He cannot offer any commission

He can offer up to 50%

Page 3: Practice Questions (1) (1)

24 Consumer Forum at district level will hear complaints up to 20L 40L 1Cr 10L 1

25 How much is the rebate allowed by IRDA to client Nil 5% 10% 35% 1

26 the controller of insurance in india is IRDA RBI SEBI 1

27 A insurer advertises through daily news paper . What type of marketing is cross selling direct selling Solicitation of Policy Brand building 3

28 Investment by NRI(Non Resident Indian) will be No risk Low risk Medium risk High risk 4

29 parents ex wife children mother 3

30 Council of Actuaries Insurance council of India Insurance institiute of India IRDA 1

31 basic qualifications of agent sound mind & graduate Age and income level 1

32 Which Institution was Constituted by Insurance Act 1938 Insurance Institute of India Life Insurance Council 2

33 What is the role of National Insurance Academy? To regulate To advise Government 3

34 Policy matters complex technical issues Promotional activities 3

35 Complaint council bodies other than IRDA grievance readdress forum & COPA Ombudsman Insurance Institute of India Insurance Association FERA 1

Insurance ombusdmen

MWP- If the policy is endorsed under MWP - then the beneficiaries are wife and ?

Mr.Sunil is doing premium calculation for his company, as per which authority is his profession related to

sound mind & good income level

His contacts in the market to solicit

Insurance

Insurance Broker Association

General Insurance Council

To undertake training activities

To Advertise globally on Indian

Insurance

According to IRDA act 1999, central governments involve in insurance industry over

Licensing of Insurance

companies

Page 4: Practice Questions (1) (1)

36 What are the ways by which a policy holder can make complaints email Toll free No. Newpaper 4

37 email Insurance ombudsmen visiting regional office Through Agents 1

38 20 lac 25 lac 30 lac 50 lac 1

39 What is the period of award passed to the customer decided by ombudsman? 2months 3 months 5 months 6 months 2

40 under all circumstances 1

41 he plans to change the plan 3

42 lung cancer and smoking . Death is certain 1

43 The type of risk that can be insured against is Speculative Risk Pure Risk Pure & Speculative risk Non Financial Risk 2

44 Ramesh declares all his liabilities Ramesh is elder than Harish 4

45 what is the min age to enter into the contract of insurance 16 18 20 21 2

46 In a whole life plan - The policyholider's responsibility to give disclosure at the beginning of the contract through out the contract Revival stage 1

47 Types of assignment Absolute Term assignment Conditional 4

Email or Toll free Number

what are the ways in which IRDA can be contacted . One is thru toll free number and other is

what is the maximum level of complaint that can be considered and taken action by ombudsmen

Raju is a certified license holder under what circumstances he needs to hold his certified license with him that is issued by irda

when he sells term insurance

when he represents himself as another insurer

when he sells pension policies

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

he has to inform the customer that the co has broken relationship with the

customer

He has to explain the reasons for rejection to the

customer

He takes up with the higher authorities

lung cancer is peril and smoking is moral hazard

smoking is peril and lung cancer is hazard

Is occupational hazard

Harish takes a life insurance policy for Ramesh. Which of the following statement best describes the principle of Insurable Interest.

Ramesh owes money form Harish

Harish suffers financial loss incase of death of Ramesh

beginning of renewal

Absolute & Conditional

Page 5: Practice Questions (1) (1)

48 why does an insurer insist on age proof document . To assess SA Risk assessment Identity verification 2

49 Mr A submitted the proposal form . When will the risk begins for the company? Submission of proposal form FPR issued Policy issued 2

50 The obligation of the insurer for the whole life policy is mentioned in Operative Clause Preamble Proviso Endorsement 1

51 Asvath photograph 4

52 Both are Standard Age Proof 3

53 To be a valid contract ,the declaration is necessary in which document Policy Document proposal form FPR RPR 2

54 operative clause Preamble Information statement schedule 3

55 Zainab takes insurance in the life of Jasmeet. Zainab will be called as Proposer Nominee Appointee Trust 1

56 No claims payable All premiums paid Sum assured 4

57 Loan is available for a policy in which there is a feature of Fund switch Savings Element Partial withdrawal Surrender 2

58 Appointee's role Signature on the proposal Medical exams insurable interest 4

59 how many nominees can be attached to a term insurance policy one two three many 4

Financial assessment

Agent accepts money

Asvath is illiterate. He wants to take policy and surya is a friend of his help him is answering questions and answers and also fills proposal . In addition to this

requirement is

asvath thump impression Only

policy document need to be registered

Left thumb Impressionof Asvath

along with a declaration of his

friend

For Logging a Policy , a person gives Baptism CERTIFICATE & Ration Card . What is this ?

Both are Non standard Age Proof

Baptism Certificate is Standard & Ration Card is Non Standard Age Proof

Baptism Certificate is Non Standard &

Ration card is Standard Age Proof

Mr. ABC buying Term insurance policy, insurer should mention Ombudsman address in which part of policy document?

Mr.Suresh dies one day before the grace period without paying the premium, what is th claim payable

Sum Assured less the latest premium

when Nominee is Minor

Page 6: Practice Questions (1) (1)

60 if a policy has two nominee mentioned what should be the Min allocation Each nominee to get Min 10% No such conditions 4

61 No bonus accumulated Its a Ulip Plan 3

62 Indexing contribution. Nomination facility. Rider benefits. Savings element. 4

63 Reasons for surrender of the policy SA advisor induced no commission 4

64 Bank Fixed deposit rate discount rate Estimated life expectancy 1

65 7680 8000 8320 8500 3

66 why ACR To calculate Premium 4

67 In a 20 year with profit policy,persist ency Bonus is paid at the end of 1st Year 10th Year 15th Year 20th Year 4

68 Fraudulent Hazard Occupational Hazard Physical Hazard Moral Hazard 4

69 Physical hazard Moral Hazard financial risk Pure risk 1

70 Who IS the primary underwriter of the customer? Underwriter Insuranc eCo Agent Actuary 3

71 Lien Bonus Surrender Accidental death 1

Each Nominee to get Min 25%

the first nominee should have more than second

a Policy holder takes a insurance contract for 30 years and the SA reduces after 25 years what could be the likely reason

Age proof was substantially wrong Policy has become paid up

A life insurance policy can only be made paid up if what particular policy feature exists?

Has Financial Problems

While calculating Human life value (HLV) two components need to be kept in mind , the one is take home salary and other is

Estimated amount at retirement

Annual premium of insurance product is Rs. 32,000, 4% loading on Quarterly mode of payment What is the quarterly premium?

To Calculate the commission due for the

agent To verify the Plan proposed

To help the underwriter to asses

the Risk

While Underwriting Mr X proposal , its found that there has been CRIMINAL case against him in Fraudulent act .What type of Risk this will be categorized

Into ?

Mr A wants insurance cover . But he is drinks alcohol frequently . What kind of hazard you may categorize?

Claim was settled however full Sum assured not paid though the policy was in force due to

Page 7: Practice Questions (1) (1)

72 Lien can be considered an alternative of which of the following Clause Rejection Acceptance Time barred 1

73 HLV report Client confidentiality report moral hazard report medical report 3

74 Moral Hazard Medical Hazard Occupational Hazard Physical Hazard 4

75 Pure Endowment Anticipated endowment term plan ULIP 3

76 At the time of maturity , quarter of the SA is paid though the policy was in force Endowment Lien Money back Surrender 3

77 Weekly premiums are generally collected for which type/range of palns Banca assurance Health plans Micro Insurance Term Insurance 3

78 Children Plan Retirement Plan Ulip Plan Term Insurance 3

79 Nil 10% 20% 30% 1

80 500000 50000 100000 300000 3

81 Life Insurance Premium PPF 50% on each 1

82 Fully taxable 10% 20% Tax fully exempted 4

83 ULIP Term Money Back Health 3

what is the special report that is asked by the underwriter from the officer of the insurer

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

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

Mr A is planning to invest and his needs are :1 Protection for is Income , during his absence 2.children education

What tax rate,if any,will be applicable to a life insurance policy holder for the maturity proceeds of a Rs 5000 life insurance policy

A policy holder can pay the premium of Rs 5,00,000 and what could be the max tax efficiency he is entitles to

Ram has Invested Rs 5000 in PPF & Rs 1 Lakh in Life insurance premium . In which he will get maximum Tax Benefit

95% on Life Insurance Premium

& 5% on PPF

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

without submitting any form of claim,a life insurance policy holder received payments of survival then what type of policy he is holding

Page 8: Practice Questions (1) (1)

84 fund switching partial with drawl premium holiday riders 1

85 By Canvassing wide peer group Seeking professional advise 2

86 Debt Funds of MF Govt Securities Equities Gold 1

87 RBI increased interest rates 2 times then the stock prices increase decrease volatile same 2

88 5 year 4 year 3 Year 2 Year 1

89 20000 24000 28000 32000 4

90 Increase gradually Decrease gradually Remain Constant 3

91 10- 20 gms 20- 50 gms 50-100 gms 10 gms 3

92 Taxation frequency of payment interest rates tenure 3

93 A person planning to invest in Kisan Vikas Patra will go to Insurance Branch Post Office Internet Mutual Fund Office 2

94 frequency of interest calculation Tax Interest tax Tenure 1

95 in ULIP policy in EPF same efficiency for both 1

what is the special feature of ulip that ensures customer risk profile for long time insurance policies

The best way to overcome the problem of investment decision depends mainly on peer influence is

Go for a low investment tranchee

Postponement of investment decision

A person who has a temporary job Loss , where should he look for Investing other than FD

A person Wants to invest in a FD for Tax benefit , How many years he has to take the term of the FD ?

aditya wants to take home loan and his monthly take home is 80,000 what as a best practice should be the maximum EMI

Ramesh has invested in Post office Monthly Income Scheme. The interest rate was set at 6%. What will be the effect of rate in going years.

Change as per market fluctuation

A person is holding 100 GOLD ETF certificates . How many grams of GOLD does he Have ?

A customer while investing in to Recurring deposit or Cumulative deposit what are the key factors which will matter

If a person chooses Cumulative deposit than Recurring deposit ,difference will be in

A policy holder pays identical premium amount for ULIP and EPF where he gets max tax efficiency

Both do not give tax benefits

Page 9: Practice Questions (1) (1)

96 Investing in ULIP plans exempts a maximum up to what limit for Income Tax 50000 75000 100000 200000 3

97 not hedge against Inflation Decrease his liquidity 4

98 An Investor has invested in Debt mutual fund,he is ideally looking for Equity return Fixed Income Stable income Savings income 4

99 Commutation Option Differed Annuity Option Guaranteed period option Open Market option 4

100 what frequencies can one take annuity monthly,quarterly,half yearly, Yearly Only 1

101 6% 9% 4.50% 10% 3

102 Yash wants to take open market option in Pension plan. What is the benefit? To save tax For improved annuity rate 3

103 Commutation option allows the annuity policy holder to with draw 25% 50% 40% 33% 4

104 commutation is a feature of which type of policy annuity joint life policy pure endowement policy 1

105 Waiting period in a health insurance policy is to address Age discrepancy Pre existing illness risk premium 2

106 cash encashment increase in the cover level 2

107 Only Danny Danny & his Wife 4

Suresh wants to transfer his physical gold to gold exchange traded fund,in relation to access,this change will

Reduce his encasement for next six months

Insurance against Uncertainties

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

fortnightly,quarterly,monthly,yearly

fortnightly,monthly ,half yearly, yearly

All ULIP pension plans have to give how much percentage as Guaranteed returns

To switch the underlying fund

To continue life cover

policy of another person

Under a health insurance policy,if a policy holder needs to avail his no claim bonus, how can that be done

discount in the next premium

certain policy exclusions

Danny is married and has two children aged 6 & 10 , His parents are aged 68 &70 . Who all can be included in Family floater option of a health plan

Danny , His wife ,His children

Danny's family and his parents

Page 10: Practice Questions (1) (1)

108 Implication of Daily Hospitalisation benefit paln Fixed amt daily SA 1

109 one sixth one third 25% 15% 2

110 Reduced the the base SA terminated continues as it is 2

111 1 Lac 2 Lac 3 Lac 4 Lac 4

112 20% 30% 40% 50% 2

113 33% 100% 20% 1

114 In a Guaranteed annuity option of 5 years , the policy holder will get annuity till entire life term annuity only for 5 years 2

115 Public Sectors do not get Sick often 2

116 Health policy for child Health policy for wife 4

117 Marginally decrease Singnifcantly increase less than after 15 years will remain same 2

118 income protection inheritance planning investment efficiency long term savings 1

119 Young married couple Pre-retirement. Retirement 4

Amt for particular diseases daily

On the expenses incurred daily due to

critical illness

Rupkumar wants to take Commutation option. What is the maximum amount he can withdraw

Critical illness rider was taken and the rider benefit has been claimed , the rider benefit now gets

New critical Illness Rider has to be added to base

Policy

A person has taken a term insurance of 4 Lac. What is the maximum Critical Illness Rider he can take

Mr. Sharma buy term insurance policy along with Accident and Disability benefits rider cost restricted upto the base premium of the policy?

Mr.Ramesh invested Rs:50000 in pension policy, what is the percentage he can avail as exemption in Income tax.

Pension plan is not eligible for tax exemption

till 5 years and continue till annuitant lives

premium payment term

Why do Self Employed Individual have the need to buy Medical Insurance rather than People working in public Sectors

Public sector employees enjoy Medical Insurance Covers related to Job

Self Employed people do not have Sick Leave

Loans are available faster for Public

sector EMPLOYEES

Mohit has two kinds, one of 6 years and other 8 years.He is the earning member and not having life cover. Before advising him to take health policy,

what he should be advised.

Life insurance policy for wife

Life Insurance policy for himself

Manoj a 26 year old is having 7 years old son. What will happen to his monthly disposable income after 15 years of job

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

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? Young married with children.

Page 11: Practice Questions (1) (1)

120 A Couple has 7 years old son, What solution would they be looking for Retirement health care child education life cover 3

121 Childhood Young Married Pre Retirement Retirement 1

122 Charges Interest Inflation Taxation 1

123 objective of fact finding client need analysis Product Pitching for completing ACR 1

124 Fact finding sheet allows the agent to Analyze customer needs Select the product Proof Reference 1

125 Low Risk Taking High Risk Taking Moderate Risk Taking Zero risk Taking 3

126

Net premium is equal to

Premium plus interest earning 3

127

Pooling of risk in insurance means

2

128

Principle of utmost good faith will operate in existing policy

Every time premium is paid 2

129 Consideration Legality of an object Consensus ad idem Acceptance 3

130

In case of life insurance, Insurable interest must exist

At inception of policy Not needed At the time of claim 1

131 Traditional deposits Recurring deposits Cumulative deposits Term Deposits 3

In which of the recognized life stages an individual does not required any protection cover

Benefit Illustration given to a customer quantifies an amount by which investment return is reduced. This reduction reflect the impact of

Finding out Moral hazards

Mr A has been approached by the Agent and on fact finding the score is 3 , this represents

Risk premium plus interest earning

Premium minus interest earning

Risk premium minus interest earning

The premium collected & deposited in a pool

All similar risks are pooled together

Premium is pool to make claims

Contribution of insurance company

If the policy has lapsed and it has to be revived

If the insured person falls sick and is admitted to

hospital

If the insured person changes his job

Both the parties to a contract must agree and understand the same thing and in the same sense which is called

Any time during the contract

With this type of deposit the bank pays the principal and the total interest at the end of the term

Page 12: Practice Questions (1) (1)

132

The Premium on all riders put together should not exceed

10% of the premium on the base policy 3

133 How riders will help the customer in life insurance Rider is like a clause Operative clause 1

134 In Daily hospitalization cash benefit scheme 1

135 CI benefit will cease CI benefit continues No change in policy 1

136

What is the main objective of taking the life insurance policy

Tax benefit Savings Investment Protection 4

137

Group Insurance can be taken in following relationship

employee- employer Husband-wife family members society members 1

138

Where one can approach in case of dispute

IRDA Consumer Forum NA NA 2

139

Life insurance is the most important for which age group

Young Pre- retirement Retirement children 1

140 2.50% 3.00% 5.00% 7.50% 3

141 1 lac 3 lacs 2 lacs 1.50 lacs 2

142 15 days of receiving the proposal 1

143

Family floater health Insurance plan covers

All members of a Family Husband and Wife only Parents only Children Only 1

20% of the premium on the base policy

30% of the premium on the base policy

40% of the premium on the base policy

allows policyholders to customize their insurance cover with additional benefits

Rider is like Preamble

The daily amount paid is fixed and will never be more or less than the cost of

actual treatment

The insurance company may pay an additional

amount on a daily basis if the insured is admitted to the Intensive Care Unit

(ICU)

The insurance company will pay for doctor

consultation fees incurred prior to hospitalization

Only surgery expenses are

included in daily hospitalization

benefi

In term insurance if Critical illness rider claim happens then what will happen to existing policy

CI benefit reduced from existing sum assured

Where annually increasing flexible premiums operate under a life insurance policy, what rate of increase will generally apply

Kamal is willing to pay 60000/- per annum for his ULIP policy. What should be the SA in case he wants to avail the tax benefits

The regulations issued by the IRDA, require that the decision on the proposal must be conveyed to the proposer within

20 days of receiving the proposal

25 days of receiving the proposal

30 days of receiving the proposal

Page 13: Practice Questions (1) (1)

144 30 days 90 days 120 days 180 days 4

145 Entire charges are refunded 3

146 IRDA SEBI RBI SBI 3

147

Indisputability clause can be enforced by the insurance company during the

First five years of policy First Two years of policy Claim 2

148 Up to Rs 50000 Up to 99990 Up to 100000 Without any limit 1

149 Monthly Quarterly Half Yearly Annually 2

150 The premium for accidental death benefit rider must not exceed 15% of base policy premium 25% of base policy premium 3

151

What amount of insurable interest does an individual have in his own life

20,000 50,000 Unlimited 4

152 2013 2015 2017 2020 2

153 Under the hospital care rider what is the payout made 10% of the sum assured NA NA 2

154 Switching Doing a financial planning Churning NA 3

155 Discounted Value Principle amount 1

According to IRDA guidelines, how long does an insurance company have to complete its investigation of a claim

How the Daily hospitalization cash benefit will provide benefits to policyholder who is hospitalized

Entire charges less bed charges will be paid

A fixed amount on a daily basis is paid irrespective of the actual cost of treatment

Only Hospital bill will be paid

Who is a regulator, supervisor and monetary authority of the financial system in India

Inception of the policy

To ensure that the premiums are paid out of a legitimate source of funds cash is accepted

In Cumulative bank deposit the interest that in normally compounded on what basis

30% of base policy premium

40% of base policy premium

Up to the sum assured taken in the plan

If the license of an agent has been disqualified by a designated authority in 2010 then the person can apply for a license in which year

Specified amount multiplied by the number of days the policyholder is hospitalized

If the agent recommends the client to terminate an endowment plan and take a whole life in order to earn higher commission its termed as

Amit has taken a G-Sec and has parted with it mid way as he required the money with the intention of not getting the interest. What will he get?

Discounted Value with persistency bonus

Principle with persistency bonus

Page 14: Practice Questions (1) (1)

156

If bonus is given under a plan the additional premium added is known as

Loading Investment Frequency NA 1

157 Joint life policy Has physical ailment NA NA 1

158

What key impact will the agent have in low persistency

Increase more business Will improve reputation 4

159

Certificate from the village panchayat

Will not be accepted NA 2

160

What is the maximum sum assured under a micro insurance

10000 25000 50000 100000 3

161 Actuary Underwriter Claim Department Accounts 1

162 Term plan Endowment plan Whole life plan Money back plan. 1

163

The insurance act of 1938 created which of these.

IRDA Tariff Advisory Committee LIC 2

164

The Authority of COPA is limited to what amount at the district level.

10,00,000. 20,00,000. 50,00,000 1,00,00,000 2

165

With reference to the principle of indemnity a life insurance policy is a.

Insurance contract. Indemnity contract. Value contract. Major life contract 3

166 Voidable Invalid Valid Null & voidable 2

167

If a contract is signed by a 15 years old boy, this contract will be

Null and void Invalid Voidable Valid 2

Suresh is suffering from Asthma and the policy in been done on joint life basis and the need for nomination under the plan is less as

Increase in the agents earning

Will have impact in his commission

Will be considered as standard age proof

Will be considered as non standard age proof

Varun wishes to pursue a career in insurance and wishes to be in a department which calculates the level of premium. In which department should

he join?

Ashish is looking at different plans of insurance for protection at the lowest premium. Which is the best plan for him?

National Insurance Academy

If Insurable interest does not exists at the time of inception of the life insurance policy then, life insurance contract is

Page 15: Practice Questions (1) (1)

168

If a life insurance policy is issued with a lien, it will be mention in

Proviso Schedule Terms & conditions Endorsement 2

169

Available Loan amount under a life Insurance policy is generally based on

Total paid premium Sum Assured Surrender value Paid up value 3

170

De- tarrification is a process by which pricing of Insurance

Rises Decreases 4

171 Some Specific Insurer All insurer It is optional 3

172 Life Insurance Council IRDA Insurance Association 2

173 What is the key function of NIA 3

174 He has switched his fund 2

175 Administrative charge Inflation Interest rate Market Risk 2

176

During Fact finding, rating is mentioned ‘3’. This Indicates

Risk apatite of client His future aspiration Commitment to need Willingness to pay 1

177

Incase of presumption of death

Claim not admissible NA 2

178 Shailesh is very older than ankit. NA NA 1

179 It is higher Decrease Slightly higher Slightly lower 2

Reaches at a level as per industry trends

Insurance can price their product on their self past experiences.

As per Regulation for protection of Policyholder’s interest 2002 (IRDA), Which insurer will have a grievance redressal System

Those Insurer who did not created Insurance

Ombudsman System

Which regulatory body has created a call center for logging a complaints of insurance Customers

Insurance Institute of India

Provide suggestion for Premium calculation

To be an active link between Global market & Indian Life

Insurance Industry

Design, implement and operate an insurance

training

Regulate the investment of funds by Life Insurance

company

After maturity In a Unit Linked Life Insurance Policy, customer does not get received Maturity in a lump sum. What is the possibility of receiving it in installments if it is not a annuity pl

He has opted for Settlement option

He has redirected his past premium

Policy was lapsed on the time of

maturity

Anand received post taxation 5% return on his fixed deposit in a bank. If his net return is 3%, what can be the reason

Not necessary to pay premium until court decree

Necessary to pay premium until court decree

Shailesh and ankit want to retire in the age of 65yrs. But shailesh pays more monthly payment than ankit. Why?

Shailesh’s income is more than Ankit’s income

What will be lien amount in 3rd year as compared to the 4th year of lien.

Page 16: Practice Questions (1) (1)

180 One year Two years Three years Five years 2

181 Needs to take expert’s suggestion Equal to base cover NA NA 2

182

Basing on which criteria the qualification of Agent is determined?

Address of the agent Domicile status NA NA 2

183 2011 2012 2013 2014 1

184

Pooling of insurance applies to

all types insurance Only life insurance 1

185 10 days 15 days 20 days 25 days 2

186

If IRDA is unable to discharge its functions or duties, Central Government

1

187 He will get tax benefit up to 5000 4

188

What are the benefits to the policyholder Under Surgical care rider?

3

189 Need not to claim 1

190 Childs education Marriage Emergency funds Income protection 4

191

Health insurance rider and critical illness rider in classified under

Life and non life respectively Both life insurance Both non life insurance 2

Within how many years a complaint can be made through consumer protection act.

One person wants to take term plan for 20 lakh and wants to take ADB rider, he is not sure of how much sum assured he needs to take for ADB rider. What is your suggestion?

A customer surrenders his policy on Feb 2011. As per Agents code of conduct, an agent can get a new policy from this customer from Feb which year

All types of insurance except Motor insurance

Only Non-life insurance

Insurance companies are required to honor the awards passed by the Insurance Ombudsman within how may days

Has the power to supersede the IRDA by issuing notification.

Has the power to supersede the IRDA by issuing a bill in

parliament

Has the power to supersede the IRDA by

issuing draft

Can make changes in IRDA law

An elderly person wants to use tax efficient investment and invests in senior citizen saving scheme. Its the impact in his taxation

He will get tax benefit up to 25%

He will get a reduction in tax slab

His investment would be deducted

from taxable income

Number of days admitted in hospital & surgery expenses in full

Number of days admitted in hospital & surgery expenses

in partial

Treatment cost of surgery subject to terms &

conditions

Lump sum amount what he has

incurred

Health insurance policy holder takes treatment in a hospital which doesn’t have cashless facility. How the policy holder will get benefited

Need to spend and Get claim from the insurer

Need to add that hospital as TPA

Need to switch to the another insurer

During financial planning session if the agent finds out the following needs, which one should be given the top priority. Needs: Income protection, Childs education, marriage and emergency funds.

Nonlife and life respectively.

Page 17: Practice Questions (1) (1)

192

Pure risk is classified under

Economic risk Speculative risk Financial risk Insurable risk 4

193 10 days 20days 30 days 60 days 3

194

As per IRDA regulations IGMS should be mandatory set up by

Only by few selected insurers Only by non life Some life and non life By all insurers. 4

195 Provisio Endorsements Operative clause 4

196

When can an insurance company give more than 35% first year commission?

1

197 When the customer asks him After the fact finding process After quantifying the need 1

198 Insurance coverage Annuity part Vesting age 3

199 213333 & 273333 213333 & 229333 229333 & 273333 229333 & 293333 1

200 Pure risk Financial risk Particular risk Physical hazard 3

201

What is the disadvantage to the insurer in case the persistency falls

Lower profits Higher profits NA NA 1

202 Consumer Forum COPA Sebi 1

203 Nil 1% 5% 10% 1

If a valid claim is delayed by the insurer then the interest for the same will have to be paid by the insurance after how many days from the date of admission of the claim?

If a customer has mentioned he is a drinker in the proposal form, the insurance company can exclude this hazard and mention it in which part of the policy document?

Terms and Conditions

When the insurance company is in the first 10 years of operation

If the agent has worked with the company for more than

5 years

If the agent has worked with the company for more

than 10 years

If the agent is doing more than 3 policies

in a month.

When should an agent disclose the commission which he will earn from the product which he is going to sell

After the product is recommended to

the client

In a pension plan illustration what are the parts which shows the benefit for an annuitant.

Guaranteed and non guaranteed part

Mr. shailsh has an endowment policy with 30 years policy term, he has paid for eight years.  The sum assured Rs.8,00,000/- and accumulated bonus Rs.60,000/-. What is the paid up value if bonus accumulated and if not bonus accumulated?

The consequences of these risks which will affect specific individuals or local communities in nature is called as

For the customer whose claim has been refused by the company, the three places where he/she should follow up are – Ombudsman, IRDA Customer Grievance Cell and ………………………..

Life Insurance Council

If a policy with premium of Rs 5000 has matured, how much will be deducted when the maturity claim arises

Page 18: Practice Questions (1) (1)

204

When a person is investing in Debt Mutual Fund, what is the primary objective

Good Returns Regular Income Safety Liquidity 4

205 2

206 Insuring existing losses. 4

207 Endowment Term Money Back Whole of Life 3

208 Group lifestyle Employees Age of the group 3

209 1

210

A low persistency ratio for the insurance company means that:

3

211 24 hours 1 day 10 days 30 days 3

212 1

213 Endowment plan ROP plan Whole life plan Ulip 2

214

Payment/Investments in Kishan Vikash Patra under post office schemes

Regularly with no fixed term 3

215 Less than 10000 More than 10000 Less than 20000 More than 20000 3

1.     If the employer has insurable interest in the life of an employee, what kind of policy is this?

A.    Surety insurance B.    Keyman Insurance C.    Partnership Insurance D.    Debtor Insurance

The concept of indemnity is based on the key principle that policyholders should be prevented from

Making false insurance claims.

Paying excessively for insurance cover.

Profiting from insurance.

A customer gets periodic benefits without any claim and then when he dies during the term of the policy, his nominees gets the sum insured. What type of policy is this ?

For assessing the risk of a group health insurance policy, which of the following information is the most critical

Medical history of group

According to Insurance Brokers Association of India, what is the most appropriate relationship between Insurer and Broker?

Insurance broker represent the client and the insurer remunerate the broker

The client represent the broker and the insurer remunerate the broker

Insurer represent both client and broker

remuneration

Broker only service the client

The customers are satisfied with the products

The company is acquiring more business and new

customers

A large numbers of policies have lapsed / surrendered

resulting in loss of profit

The company will not declare bonus

What is the stipulated time frame within which an insurer is supposed to respond after receiving any communication from its policyholders?

The proposer can withdraw from the contract, if they disagree with the terms and conditions of the Policy, within a ‘free look-in period’ of

15 days from the date of receipt of the policy document

20 days from the date of receipt of the policy

document

25 days from the date of receipt of the policy

document

30 days from the date of receipt of the

policy document

Rakesh wants to buy a policy primarily for Risk Cover but at the end of the term he wants to get at least some return. Under which policy he will get these benefits

Lump Sum with no fixed term

Lump Sum for fixed period of time

Regularly for fixed period of time

Prashant buys an Endowment Plan with a sum assured of Re. 100000 and wants to make use of tax benefit under the policy for whole SA. How much premium would help him avail this benefit

Page 19: Practice Questions (1) (1)

216 5 days from the receipt 10 days from the receipt 15 days from the receipt 3

217

Law of Large number helps the insures to

Calculate the premium Increase the profitability Ascertain the death ratio Declare the bonus 3

218 Physical Moral Occupation NA 2

219

Whose signature is required on attestation of the policy?

Agent Policy holder Proposer 3

220

What is the ceiling of tax exemption under 80 c.

1 lakh 1.5 lakhs 2 lakhs 3 lakhs 1

221 20% 26% 49% 51% 2

222

The functions of the Insurance Ombudsman include:

Conciliation and making awards Counseling Repudiation of claim 1

223 Non life insurer Life Insure Reinsurer Any Insurer 1

224 6% and 10% 5% and 10% 6% and 12% 5% and 12% 1

225

What is commutation of installments

1

226

Employee has insurable interest in the life of their employer to the extent of

Yearly Salary Monthly Salary Probation Period Till Gratuity 2

227

Rahul is appointed as director of life insurance company, he cannot be an

Insurance Advisor Nodal officer Chief actuary Underwriter 1

Under the IRDA guidelines for Claim settlement, any queries or additional documents can asked from the claimant within

20 days from the receipt

A person with a criminal background due to Financial fraud would come under which hazard

Authorized officials of insurer

Under the prevailing FDI laws for insurance, domestic private companies are allowed to form joint ventures with foreign partners. What percent of stake can a foreign partner hold?

Evaluating claim settlement

If a client needs Mediclaim to cover health insurance which insurer he needs to apply.

The agent can use the benefit illustration document to show the client the projected growth of investment at the rate of –

The lump sum withdrawal before receiving periodic installments of

annuity

The lump sum withdrawal before receiving maturity

benefit

The lump sum withdrawal before receiving Survival

benefit

The lump sum withdrawal before receiving Death

benefit

Page 20: Practice Questions (1) (1)

228 Retirement plan Health insurance for parents Term Assurance Endowment Plan 2

229

The mutual obligation of the parties is laid down in?

Operative Clause Heading Proviso Attestation 1

230

Health Insurance is needed because

Life is very uncertain NA 2

231

Insurance agents are

Who work only for insurance company Who work for customers Intermediaries 3

232 Capacity to Contract Legality of object Capability of performance 2

233 3

234 Increases Reduces Remains same Depends on insurer 2

235 Reviewed NA NA 2

236 A policy Assignment A Fradulent Claim A steep rise in inflation A sudden illness 2

237 Surrender Paid Up Endorsement Assignment 3

238

HLV is used as a Yardstick to determine

Emotion Loss can be compensated for NA 2

239 Commission Pay to their agents Detail of charges Both of the above None of the above 1

Ajay and Vijay both are unmarried. Ajay has dependant Parent. Which need Ajay must take care of on priority, although that will not be a priority for Vijay?

Cost of healthcare has increased significantly

Premium increases with age

Who works for their own interest.

Mr Rohan takes an insurance policy due to heavy Debt on his business with an intention of committing suicide. This is an example of the following Feature of a valid contract

Offer and acceptance

Rajan and Rajini has taken a Family Floater health insurance Plan of 4 lacs. They met with an accident and had a hospital bill of 6 lacs. Which is true for this situation:

They would get the claim of 6 lacs since the individual cover is 8 lacs

The claim will depend on the surveyor

The maximum claim will be of 4 lacs

Rajan will get a claim of 3 lacs and Rajini will get 1 lacs

When an individual gets older, chances of obtaining life and health protection will be

Any assets, which are no longer suitable or are earning fewer returns than expected, should be

Cashed in for investment into other assets

What key event is most likely to prevent insurer from ensuring that each insured person brings a fair premium to the pool for the risk presented?

The Insurance companies allow modification/alteration of the original policy documents through...

The correct cover needed to compensate economical

loss to their family in case of death of the earning

member

A lump sum amount that the person will get from the

insurance company

With effect from 1st July 2010 all insurers have to disclose in the benefit illustration document the..

Page 21: Practice Questions (1) (1)

240

If the client accept the recommendation, then the agent should ask the client..

To pay the premium To fill in the proposal form To ask the documents None of the above 2

241

Unethical behavior can affect the reputation

Insurance Agent & company Insurance Agent Insurance company Insured person 1

242 1

243 Notify the insurer of this matter 1

244 2

245 2

246 Young unmarried Young married Young married with Kids Pre retirement 4

247 Regulation Redressal Research Repository 3

248 Insist on taking the product right away 3

249 Term Insurance Plan Endowment plan Return of premium plan Pension plan 3

250 It was assigned. It was paid up. It was lost. It was surrendered. 3

251 It was lost. It was paid up. It was lapsed. It was surrendered. 1

An agent is not required to obtain the prior approval of the insurer before placing an advertisement when:

It contains only statements that mention the agents name, logo &

phone number.

He can design the advertisement without the

concern of insurer.

Were all his information published to enhance his

business.

Describe the benefits which do

not match the policy provisions

If a person already suffering from some disease and had not mentioned it in the proposal form then as per IRDA code of conduct the agent should

Refuse to act for the customer benefit

Ask the proposer’s doctor to send details to the

insurer

Respect this confidentiality by not

disclosing it to anyone

How are perils and hazards normally distinguished under term insurance policies?

Perils are medical factors which influence the risk of dying and hazards are lifestyle activities which influence

the risk of dying.

Perils are risks that policyholders will die before

a specified date and hazards are factors which could influence that risk.

Perils are factors which affect the risk being insured and hazards are the size of

the risk being insured.

Perils are factors which could

influence an insured event occurring and

hazards are the actual events which will trigger a payout

In the context of financial planning, how is the difference between real needs and perceived needs best described?

Real needs are financial needs and perceived needs are non-financial

needs.

Real needs are actual needs and perceived needs are

based on a client’s thoughts and desires.

Real needs are identified by the insurance agent and

perceived needs are identified by the client.

Real needs are needs which satisfy

an objective and perceived needs are needs which do not satisfy an objective.

If a person is concentrating more on health plan and retirement plan then at which stage of life is he in.

The Institute of insurance and risk management along with insurance education does what more

If the client does not wish to proceed with the recommendations right at the moment the agent should

Should ask for the reason for not going with the

recommendation

Should ask for a future date from the client

Should review once again

Suresh has adequate reserve capital with him and he wishes to protect his income, moreover he feels that if he does not die then he would need the amount. What type of plan should he opt for?

A claim was paid in a policy and it was advertised in the newspaper also. This indicates that the policy was.

An indemnity bond was signed in a policy when the claim was paid. This indicates that the policy was.

Page 22: Practice Questions (1) (1)

252 Marriage. Savings. Education. Protection. 1

253 Inflation. Interest. Discount rate Compounding. 3

254 Vishal is older than Sandeep 2

255

During fact finding, What will be the next step after Identifying clients need

Quantify clients need Priorities Clients Need Recommending Product 1

256 Guarantees Taxation Tenure Lock in periods 1

257 Savings Insurance Investment management Planning for pension 3

258 Physical hazard Fraudulent representation Moral hazard Peril 1

259

Which of the following falls under voidable contract?

Misrepresentation Lack of insurable interest Fraud None of the above 1

260

Law of large numbers is worked out by which of the following?

Pooling of risk With utmost good faith Randomness 1

261 Individual agent Corporate agent Bank Broker 4

262

If a person want to maintain emergency funds the best place is a bank or

Equity market ULIP Debt mutual fund FD 3

263 Do the fact finding exercise again 3

Manish and Manisha is a married couple with one child. They want to plan for savings, child education/marriage and their retirement and protection of income. Which should be their lowest priority?

While calculating HLV along with future income, no of years of work, increments in salary what is also to be taken in to account?

Vishal and sandeep applied for a health plan in XYZ Life Insurance Company. Vishal is asked to undergo a medical checkup but Sandeep is not asked to do so. What will be most possible reason?

Sandeep has taken another policy from XYZ Life Insurance Company

Sandeep is earning more then Vishal

Vishal is working in a MNC

Fill up the proposal form

What is the similarity between Recurring Deposits & cumulative deposits in a bank

Mrs. Sheela received some amount out of her husband’s death. In such a situation what will be her prime focus?

Mr. Kunal used to participate in Car race. While taking up the Insurance policy he disclosed this information. What kind of hazard does it refers to

Maintaining insurable interest

If a client wants to compare between all financial products then the best person he can approach is

During a fact finding process the need analyzed were income replacement and children’s education. But the customer insists on only a child plan for the time being and asks the agent to give him a child plan. The agent should.

Insist with the client to take a term plan

Give a child plan and revisit the client on a later date

Give the lead to another agent

Page 23: Practice Questions (1) (1)

264

If a case is already before the consumer forum, then the ombudsman should

Give a recommendation Dismiss the case Give an award. 3

265 It rises It falls It remains constant 3

266

What is the advantage of converting physical gold assets to gold ETFs.

Liquidity More gold in value Purity 1

267 Increase his liquidity Decrease his liquidity 1

268 Physical Hazard Moral Hazard SA is too high Pure Risk 3

269 Suggest an alternative plan Pass on to the superior 1

270 Fraudulent claim Indisputability clause Redressal procedure 2

271 Under no circumstances As directed by actuary 1

272 Only health certificate 1

273

Frequent switching is not advisable in ULIP plan because it increase

Investment Risk Risk of death Uncertainty of return Chances of lapse 1

274 4

275 Ensure Better annuity rate Increase in the range Increase in return Switch of Funds 2

Give a joint decision with the consumer forum

If the sum assured remains the same, what will be impact of net premium if the age of the policyholder increases

Gross premiums increases

More conversion value

Suresh wants to transfer his physical gold to gold exchange traded fund,in relation to access, this change will

Reduce his ability to encash for next six months

Create a future exit liability

For which of the following reasons, the underwriter should ask beyond agent’s confidential report.

After doing the need analysis of the client, the agent advised the client to opt for TROP product. But the client refused. According to ethical business practices what will the agent do ?

Enquire about the refusal from the client

Pass on to the other agent

Generally insurance companies do not hold the premium in case of a fraud or misrepresentation. However, due to which of the following circumstances the insurer can retain the premium of the policyholder

Pending decision from Ombudsman

With pooling of risks an insurance company pools the premium collected from several individuals to insure them against similar risks. At what circumstances will the insurance companies pool the risk of a life insurance and health insurance together?

Under conditions of the reinsurer

As per company policy

In case the customer has stopped making payment for the premium of the policy. What are the two most important things required in order to reinstate the policy?

Reinstatement Fee and Proof of continuing good health

Premium cheque and health declaration

Premium cheque with arrears

An insurance agent sold two policies to two different persons having the same policy term. He declares the commission to each of them. The commission of one of the policy is more than the other. What should be the reasons for this difference?

Risk profile of both the policyholder are different

Age of both the candidate are different

One has chosen Single premium policy and other

has chosen regular premium policy

Both have chosen different kind of

policies.

Open market option under Annuity policy would extend which of the following benefit?

Page 24: Practice Questions (1) (1)

276 Money Back Term Plan Endowment Plan ULIP 4

277 Fact finding 1

278 Ajit is NRI and vijit is Indian NA 1

279 A family floater Life insurance Individual cover 1

280 6 weeks 1 month 2 months 6 months 2

281 Age admission Disclosure of material fact Premiums paid or not NA 2

282 A’s health was better than B A’s term was longer than B B’s term was longer than A NA 3

283 Pooling of risk Transfer of risk Prevention of risk Sharing of risk 2

284 Medical reports Proposal form Policy document NA 2

285 Change not allowed 2

286

An insurer can invoke indisputability clause in case of death only in

Non payment of due premium NA NA 2

287

Compound reversionary bonus of 4 % will be calculated on

Sum assured Premiums paid till date 2

Akash is an Unmarried person and employed with company ABC and drawing a handsome salary. He has no liabilities. What kind of plan can be suggested to him?

What should an agent do in order to understand the mental state of client in respect to his investments in saving products

Consulting the client’s parents

Consulting the family of the client

Reviewing his existing investments

Ajit and vijit are 2 friends paying same premium for health insurance. Why ajit has higher tax exemption eligibility than vijit

Ajit is above 65years of age whereas vijit is below 65

Ajit’s health is better than vijit

Sumit is having 2 children. He wishes to have health cover for himself and his wife. Which suits him the most?

Group health insurance plan

A policy holder is not satisfied with the services of the insurer and complains to ombudsman. In how many days from receipt of the complaint the ombudsman should pass the recommendation.

As per claims assessment process if a claim arises within a few days of the start of the policy which factor should the insurer check in the first place?

A and B start their policies on the same date and surrender on 22nd anniversary of the policy. But A’s surrender value is higher than B. the reason was ;

In life insurance industry which mechanism operates so as to enable the individuals to reduce the impact of risks

Which from the following would help best the underwriter to know whether the proposer had applied previously and his application was rejected

A policyholder wants to change the nomination after 5 years of the policy. What would happen

Can be done through endorsement

Can be done through an affidavit sworn in

A simple application would do.

Breach of duty of disclosure of material facts

Sum assured plus bonus till date

Sum assured minus bonuses paid till

date

Page 25: Practice Questions (1) (1)

288

A proposer shows his age lesser than his actual age. This will be termed as

Breach of utmost good faith Breach of trust NA NA 1

289 Maximum 10% Half of the commission Cannot rebate at all 2% 3

290 Margin money Retirement plan 3

291 The inflation rate The interest rate His income NA 1

292 Gratuity amount His standard of living NA NA 1

293 Diversified Lessened Increased NA 1

294 Endowment Term Whole life Moneyback 3

295 Explaining charge structure Issuing reminders 2

296

Underselling life insurance comes under unethical practices because

NA 1

297 Benefits of the products NA 1

298

The income of an individual can be protected with the help of

a unit linked policy a term life policy an endowment policy a money back policy 2

299

As per the IRDA circular an insurance agent

Should not disclose 3

An agent recommends a term plan in keeping with the ethical standards since it was suitable to client’s needs.  In such a case what is the percentage of commission which he can rebate so as to beat the competition

A client has got some funds and wants to provide for retirement and margin money. What should be his priority

Depends upon his actual age and years left for

retirement

Depends upon the amount needed

While planning for retirement fund to calculate the required amount needed at that time we should consider as priority

While calculating retirement fund required for a self employed person which of the following option will automatically be ruled out

A client has his investment in equity shares. Agent advises him to keep it in equity based mutual fund. This will make the risk

Ajay is 35 years old. He wants good amount of life insurance cover along with savings element with no defined term. Which plan should be suggested

Which of the following act from agent will be specifically useful in case of annual premium policies compared to monthly mode policies

Offering credit facility to client

Offering premium collection facility to

client

It might fell short of actual needed and family would suffer

It will bring a smaller premium

Tax exemption will be lesser

During product recommendation the agent should explain the product in relation to

The needs that came to fore in fact find process

Commission on the products

need not disclose the amount of commission

need to disclose the amount of commission

needs to disclose the amount of commission on

demand

Page 26: Practice Questions (1) (1)

300

During the recommendation stage the advisor needs to

1

301 3

302 Convertible Endowment plan Convertible Term plan 2

303 Fact Finding document KYC document 3

304 Non-disclosure of material facts 2

305

When does nomination get invalidated

On assignment NA NA 1

306

Law of large numbers help in calculating the

severity of risk physical hazard moral hazard Probability of risk 1

307

A lien is generally used as a substitute to charging

a high premium for a high risk NA NA 1

308 Agent Broker NGO Bank 1

309 Indexed Guaranteed Unit linked NA 3

310 Child Investment Health Insurance Life Insurance Retirement 4

311 Excessive Premium SA ceased too early 1

recommend the products that best meet the client's needs

recommend to wait some days to invest

recommend the new product the company has

recently launched

Recommend to take own time to take a

decision.

Mr. Anil has a money back policy and a whole life policy. He is planning to take some loan from both the policies as he was regularly paying the premium. What is your suggestion?

He regularly pays premium so he can take loan from both the policies

He can surrender whole life policy and can take loan from Money back policy

He can’t take loan from money back but can avail loan from Whole life policy

He can’t take loan from whole life

policy but can avail loan from Money

back policy

Mr. Kartik got a job recently, he can’t afford to pay to pay the higher premium as of now but in future once he settles down with his job he can pay higher premium.  Which one will be the best plan?

Convertible pure Endowment

Convertible money back plan   

An agent was explaining to his customer the guaranteed benefits of the product. Which one of the following documents he would have used to explain the same?

Benefit  illustration document

Client benefit document  

 Mr. Mehra wants to insure his wife. Previously his proposal was rejected by another company, but this time he submits the proposal form without showing this to a new company. This is 

Concealment of material facts

Fraudulent misrepresentation of

material facts

Innocent misrepresentation of

material facts

If more than one person is nominated

for reduction in sum assured

If the customer wants to seek information about all products, then he can avail the services of

In case of pension plans a guaranteed minimum return of 4.5 % is applicable when the plan is

A married couple having 9 year old child have to consider life insurance, health insurance, child investment & retirement plans for their better future as a family but at present condition which aspect should be kept at lowest priority?

The main reason why an agents act of underselling insurance is treated as a unethical behavior is

Benefit could fall short of the financial liabilities

Tax concession opportunity could be

lost forever

Page 27: Practice Questions (1) (1)

312

In which type of insurance Insurable Interest exists at the time of claim?

Liability Insurance Marine Insurance Motor Insurance Travel Insurance 2

313 Contact the Regulators Issue a wrong note Refuse to proceed Inform the insurer 3

314 Quotation Request Form Proposal Form Policy Document Claim Form 2

315 Switching Doing a financial planning Churning Fact Finding 3

316 It affects the basic cost of cover 3

317

A low persistency ratio for the insurance company means that:

1

318

Mr. Shyam is having 9 year old child. Which product is not to be given priority?

Health plan Child Plan Life Insurance Retirement Plan 4

319

Which is the best option to manage risk?

Retain Transfer Avoid None 2

320

What is the major reason for self employed to take insurance.

Save Tax Fluctuating income High Returns Protection 4

321

What is the major reason for conducting fact finding exercise?

Need analysis Understand about company Introduction of agent 1

322 60000 75000 100000 5000 2

323

The guidelines for annual assumed growth rate are given by

Life Insurance Council IRDA Actuaries Underwriter 2

In a process of completion of an insurance proposal, an agent finds that the intention of the proposer was not genuine. In this case what should the agent do?

The documents likely to provide the underwriter of an insurance company, the details relating to the previous subject application, which have been accepted as non-standard..

If the agent recommends the client to terminate an endowment plan and take a whole life in order to earn higher commission its termed as

After completing a Fact Finding activity for a client, who is self employed, the main reason why it is important to record the type of work that he is involved in is…

Dictate the Rider Benefit should be recommended

Helps to quantify the client’s attitude to risk

Influence the tax status

The customers are satisfied with the products

The company is acquiring more business and new

customers

A large numbers of policies have lapsed / surrendered

resulting in loss of profit

The company will not declare bonus

Understanding the Customer

If 5% bonus is given every year then for a SA of 1 lakh, what will be the payout after 15 years in a simple revisionary bonus system?

Page 28: Practice Questions (1) (1)

324

Pricing element is done by

IRDA Insurance Company Life Insurance Council CII 2

325 Inspection by IRDA Audit by Finance Ministry 4

326 National Commission District Level State Level Mandal Level 2

327 No, as 15 days period is over Yes, as it is within 1 year 1

328 Term & Children Plan Annuity Plan Whole Life Plan Health Plan 1

329 Transfer Control Retaining Avoidance 3

330 Yes, as both are teachers 2

331 Normal Fraudulent Early General 3

332

What is the minimum Sum Assured allowed for Micro Insurance?

5000 10000 15000 20000 1

333

What does MDRT Stand for?

Million Dollar Round Table Major Double Rupees Tag Major Dollar Round Tag 1

334 A clause A Lien A Loading Level Premium 2

335 Ask the client to fill the proposal form 2

AML Program of every insurer to include _______________, apart from Procedure, Training and audit.

Appointment of Principal Compliance Officer

Inspection by Auditor General

Ravi was expecting a claim amount of Rs. 12, 00,000 from insurer. But it was rejected. He feels that it is repudiated on wrong reasons. Which consumer forum can he approach?

Vijay received his policy bond on 11th June, 2011. Due to some personal problems he has decided to cancel the policy on 8th July, 2011. Can he cancel or return the policy?

No, as 20 days period is over

Yes, as it is within 3 months

Naresh is married and his daughter Sneha is 3 years old. Which plan can he take?

Vinay doesn’t want to take insurance on himself. He feels that his family will survive with the funds available in the bank and monthly rentals received from village. This comes under Risk ______

Naveen, aged 32 years, has taken money back plan. He is a teacher by profession. Naveen referred Prasad to Ram. Prasad is also teacher. Ram who is an agent advised Prasad to take money back plan as he is of same age (33 years). Is it the right advice? Why?

Yes, as Naveen and Ram are of same age.

No, customers needs are different

No, as there is an age difference.

Ajay has bought an endowment insurance plan with a cover of Rs. 10, 00,000 for a term of 15 years. Ajay died after 4 years. Insurance company will not treat this claim as ________ claim.

Mean Disposition Residence Time

In a case, the underwriter felt that the risk associated with the person would decrease with time, then he would accept the case with

If the recommendation of the agent has been rejected by the client, the agent should:

Find out the reasons for refusal

Must try to convince the client to follow his recommendation

Must try to force the client to follow his recommendation

Page 29: Practice Questions (1) (1)

336

Which of the following is true regarding Family Floater Health Insurance Plan?

4

337

In what proportion is the cover in a Family Floater Plan shared?

25% each 15% each 50% each No Proportion 4

338 Agent Insured Policy Holder Insured person 1

339 Critical Illness Rider Hospitalization Care Rider Accidental Benefit Rider Surgical Care Rider 2

340 X only X with wife X with wife and kids X with all 4

341

Maximum Life cover

20 times annual salary 500000 1500000 4000000 1

342

As per AML regulation, it allows cash premium not over than

Rs.20000 Rs.25000 Rs.5000 Rs.50000 4

343

Bank interest is accumulated

Monthly Yearly Quarterly Once in 6 months 4

344

_____ controls monetary system in India

RBI IRDA SEBI Constitution 1

345

Hospitalization rider has the following benefit:

1

346

The main purpose of buying an insurance policy normally is

to develop the habit of savings 3

347

Insurance is a mechanism through which risk of an individual can normally be

transferred prevented avoided reduced 1

A Family Floater Plan is the same as a Individual Plan

Only self and spouse can be covered in this plan

Any number of people may be covered in this plan.

The insurance cover is shared amongst the family members

in no fixed Proportion

To identify suitable products their main features and their tax treatments is the role of:

The rider which is given by the Insurance company pays for the treatment costs in the event of hospitalization of the insured person is called

Mr. X is married with wife, 2 children and aged parents Health premium is allowed for

Person receives fixed amt daily for no of days in hospital

Person receives an amount equal to the expense.

Person receives a fixed amount of 1000 daily.

Person receives benefit only if he is hospitalized for 3 days minimum

to obtain Income Tax benefits

for protection of financial security

to obtain loan as when required to

meet financial obligations

Page 30: Practice Questions (1) (1)

348 4

349 all types of financial risks the homogeneous risks the heterogeneous risks the speculative risks 2

350 Capability of performance Legality of object Capacity to contract Offer 3

351 3

352

What role an agent is likely to play in the process of underwriting?

3

353 4

354

The basic elements of life insurance are:

Accident benefit and riders. 3

355

Pick the wrong answer. In a child plan:

Deferred date is a policy anniversary. 2

356 2

357 Retirement fund Emergency fund Fund for untimely death Education Fund 2

358 3

359 Cashless facility Exclusion No claim bonus Waiting period 3

In the context of Insurance terminology, how the meaning of ‘Peril’, ‘Risk’ and ‘Hazard’ is best described?

Peril, Risk and Hazard are of the same meaning

Peril is the event, Risk is the loss of event and Hazard is

the wrongful even

Peril is the event, Risk is the cause of event and the

Hazard is an event of dangerous nature

Peril is the event, Risk is the likely

occurrence of the event and the

Hazard increases the chances of happening of the

event.

Pooling of risks is one of the fundamental principles of insurance where the Insurers pool the premium collected from

Rohit, 17 years old, submitted a proposal for Endowment plan of Rs.1 lac to AB Insurance Co. In the absence of an essential ingredient of a valid contract, the proposal was not accepted. Which factor caused the insurer for non-acceptance of the proposal?

A proposal of life insurance is not accepted in the absence of Insurable interest which mainly depends on the

blood relation between the Proposer and the Life assured

Proximity of relationship between the Proposal and

the Life assured

Financial relationship between the Proposer and

the Life assured

Emotional relationship between the

Proposer and the Life assured

To see that the proposal is accepted by the underwriter at OR

To ensure that his client is not burdened with extra

premium

To give truthful report to the Insurer all about the life

to be insured

To see that the plan as proposed by the

client is not changed on underwriting

In insurance, HLV is a known abbreviated term. How the meaning of HLV can best be described in relation to a income earning proposer?

Sum assured is the HLV of the proposer

Yearly income is the HLV of the proposer

Difference between the Assets and Liabilities is the

HLV of the proposer

Present value of the future earnings less personal expenses is the HLV of the

proposer

Pension and monthly income.

Death cover and maturity benefit.

Interest yield and variable income

On vesting date policy has to be assigned to the life

assured.

After vesting the contract is between the insurer and

the life assured.

Deferred date is date on which the risk commences.

There is a relation between Age, Risk and Risk appetite. Which relation is most likely to be acceptable?

Age increases, Risk increases and the Risk appetite increases

Age increases, Risk increases and the Risk

appetite decreases

Age increases, Risk decreases and the Risk

appetite increases

Age increases, Risk decreases and the

Risk appetite decreases

Regular savings creates a fund to meet adverse incidents in future. For drawing a financial plan for savings needs of an individual without capital, what is the Fund which comes first?

A Proposer asks for double death benefit in an Endowment assurance plan for 15 years. How his proposal will suitably be dealt with?

By offering another Endowment assurance plan

By addition of Accident Benefit rider to the proposed Endowment assurance plan

By addition of Term assurance rider to the proposed Endowment

assurance plan

By addition of Premium waiver

rider to the proposed

Endowment assurance plan

In a Health insurance plan what the particular feature is likely to cause the Insurer to decrease the Renewal premium?

Page 31: Practice Questions (1) (1)

360 Employment Age Marital Status Liability 2

361

A provision for superannuation is normally taken a high need to

a Public sector employee an unmarried young A self-employed person 3

362 Disability Unemployment Sickness Education 4

363

Which one is not an asset

House House loan All of them 2

364 Sales transactions Relationship transactions Monetary transactions 2

365 IRDA Act,1999 IRDA Regulations, 2000 Insurance Act,1938 3

366 3

367 4

368

Agent offering rebate may be fined

Rs. 300 Rs500 Rs 1000 Any of them 2

369

In MWP Act Policy, claim is paid to

Nominee Assignee Trustee Policy holder 3

370 for life 4

371

Central govt has authority of Direction to IRDA on

Policy matter May issue notification All of them. 4

Out of all the factors that affect the needs of different life stages of an individual, which is the most common factor that is likely to exist throughout the life span of an individual?

A Government employee

Financial planning may not be taken as complete till inclusion of the predictable needs of the clients. It is likely to emerge from the incident of

Investment in shares and mutual fund

Transactions of sale of life insurance products to the insurable clients are viewed in the Insurance market mostly as

Assured transactions

Which Act or Regulation provides that the Renewal commission is payable to the legal heirs of the Insurance agent in case of his death?

Indian Contract Act,1872

Ranjan took out a 20 years Money Back plan on his own life 5 years ago. Survival benefit was due on 4.5.2011. Ranjan died on 6.5.2011 without receiving the survival benefit amount. What will be the legitimate procedure to pay out the claim?

Survival claim will not be paid and only death claim will be paid to the Nominee

Both the survival claim and the death claim will be paid

to the Nominee

Survival claim will be paid to the Legal heirs and the

death claim to the Nominee

Bothe claims will be paid to the Legal

heirs

A life assured died after 40 days from the payment of his monthly premium. If there be any claim, how the claim will normally be dealt with?

A regret letter will go intimating that nothing is payable as death claim

Full sum assured will be paid as death claim

Paid up value, if any, will be paid as death claim

Full sum assured less deduction of

unpaid premium will be paid

If an Insurance agent is found guilty of breach of trust, he will be disqualified to act as an insurance agent. The disqualification stands valid

for 10 years from the date of disqualification

for 7 year from the date of judgment

for 5 years since completion of the sentence imposed

To present statement of IRDA act in Parliament

Page 32: Practice Questions (1) (1)

372 Market competition Regulations of IRDA 4

373 Insurance Ombudsman IRDA 2

374 4

375 4

376

Principle of utmost good faith is expected for max up to which stage

Before the contract is concluded NA NA NA 1

377

A nomination is not required if

Policy is taken under joint life basis NA NA NA 1

378

Bank savings account earn cumulative interest at what frequency

Monthly NA NA NA 1

379

A person has 6 months of emergency funds.This is:

Reasonable NA NA NA 1

380 Prinipal amount NA NA NA 1

381

Daily hospitalisation benefit:

NA NA NA 1

382

ADB rider premium cannot exceed

30% of the base premium NA NA NA 1

383 NA NA NA 1

It is the bounden duty of the Insurers to protect the interests of their policyholders from proposal acceptance to claim payment because of the

Behavioral requirements of E-Governance

Requirements of the Life Insurance Council

For redress of grievances of the policyholders, a number of Authorities have been formed. Which of the Following authorities has been empowered to hear the complaints and adjudicate?

Consumer Grievance Redress Forum

Consumer Affairs department

In the context of IRDA’s code of conduct, the term Ethical behavior can be best described as

a behavior that is based upon the positive judgment of an individual

a behavior that is based upon the legal judgment of

an individual

a behavior that is based upon the ritual judgment of

an individual

a behavior that is based upon the

moral judgment of an individual

An agent offered his client that 75% of the first premium will be paid by him out of commission. This offer of rebate on premium will be treated as

a kind of gift for purchasing insurance products

a rebate on the price amount like other sales

a breach of IRDA’s code of conduct

a breach of a provision of the

Insurance Act,1938

If I invest in a G sec partway(ignore periodic interest payments).I will get on Maturity

No of days spent in hospital multiplied by Daily hospitalisation benefit

An agent does 6 lacs of new business premium /Income in a year. He is a composite agent. What is the maximum Premium/Income he can earn from 1 insurer?

Page 33: Practice Questions (1) (1)

384

Persistency can be improved by:

Providing service to the clients NA NA NA 1

385

IIRM is in areas of education and

Research NA NA NA 1

386 1. Inflation. 2. Interest. 3. Discount rate 4. Compounding. 3

387 Which of the following falls under voidable contract? 1. Misrepresentation 2. Lack of insurable interest 3. Fraud 1

388 1. paid up to 75 Yrs 3. till he die 4. not remembered 2

389 1. He has switched his fund 2

390 1. Administrative charge 2. Inflation 3. Interest rate 4. Market Risk 2

391 During Fact finding, rating is mentioned ‘3’. This Indicates 1. Risk apatite of client 2. His future aspiration 3. Commitment to need 1

392 Incase of presumption of death 3. Claim not admissible 2

393 1. Nil 2. 10% 3. 20% 4. 30% 1

394 Pooling of insurance applies to 1. all types insurance 3. Only life insurance 1

395 1. Childs education 2. Marriage 3. Emergency funds 4. Income protection 4

While calculating HLV along with future income, no of years of work, increments in salary what is also to be taken in to account?

4. None of the above

Customer has opted for a 5 yrs guaranteed annuity option. What will happen to annuity, if the customer survives for 5 years after the end of guarantee period?

2. annuity will be continued for next 5 Years

After maturity In a Unit Linked Life Insurance Policy, customer does not get received Maturity in a lump sum. What is the possibility of receiving it in installments if it is not a annuity plan

2. He has opted for Settlement option

3. He has he has redirected his past

premium.

4. Policy was lapsed on the time of

maturity

Anand received post taxation 5% return on his fixed deposit in a bank. If his net return is 3%, what can be the reason

4. Willingness to pay

1. Not necessary to pay premium until court decree

2. Necessary to pay premium until court decree

4. Depends on case to case

Which tax rate is applicable, in case of Client pays the premium of 5000/- and suffers illness before maturity?

2. All types of insurance except Motor insurance

4. Only Non-life insurance

During financial planning session if the agent finds out the following needs, which one should be given the top priority. Needs: Income protection, Childs education, marriage and emergency funds.

Page 34: Practice Questions (1) (1)

396 1. Group lifestyle 2. Employees 3. Age of the group 3

397 1. Critical Illness Rider 3. Accidental Benefit Rider 2

398 A Professional insurance market carries….. 1. Need – Based Selling 2. Product – Based Selling 1

399 Insurance Market divided into 2

400 What is Bancassurance? 1. Giving insurance policies to Banks. 2

401 The “Risk” contains…. 1. Peril and Hazard 2. Level 3. Uncertainty 4. All of the above. 4

402 Grouping the similar risks by Insurance Company is called as…. 1. Grouping of Risk 2. Risk Grading 3. Risk Assessment 4. Pooling of Risk 4

403 The function of Insurance works on….. 1. Risk Transfer 2. Risk avoid 3. Risk retention. 4. All of the above. 1

404 A contract comes into existence when……… 1

405 1. Anti Money Laundry 4. All of the above 2

406 Under this situation may leads to breach of the duty of utmost good faith. 1. Non disclosure of material facts. 4. All of the above. 4

407 The principle of utmost good faith is not applicable to 1. Facts of common knowledge 2. Facts of law 4. All of the above. 4

For assessing the risk of a group health insurance policy, which of the following information is the most critical

4. Medical history of group

The rider which is given by the Insurance company pays for the treatment costs in the event of hospitalization of the insured person is called 2. Hospitalization Care Rider 4. Surgical Care

Rider

3. Commission – Based Selling

4. Company – Based Selling.

1. Endowment and Money Back Insurance

2. Life and General (non-life) Insurance

3. Government and Private Insurance Markets

4. Health and Saving Insurance

Markets

2. Selling insurance policies through Banks.

3. Giving guarantee to policies by Banks.

4. None of the above.

1. One party makes an offer which the other party accepts unconditionally.

2. One party makes an offer which the other party put

extra conditions.

3. One party makes an offer where other party

gives counter offer.

4. One party makes an offer which the

other party receives the offer.

Mr. Kumar’s wife is suffering from blood cancer. Doctors lost their hope on her live. Mr. Kumar would like to take Life Insurance policy on wife’s name in order to get monitory benefit. Insurance company rejects this proposal on the grounds of…….

2. Legality of object or purpose

3. Capacity of paying future premiums.

2. Concealment of a material fact

3. Fraudulent misrepresentation of facts.

3. Facts those are not material.

Page 35: Practice Questions (1) (1)

408 1. Advertisements. 2. Proposal form. 3. Conducting interviews. 2

409 What are the factors involved in calculating Surrender Value of the Policy? 1. Number of year’s premium paid. 3. Sum Assured 4. All of the above. 4

410 3

411 Moral Hazard reflects the ……. 1. Intentions and attitude of Proposer. 1

412 Income replacement methods equates Human Life Value (HLV) to 1. Future value of Present earnings. 2

413 Agent will be called as….. 1. Primary Underwriter 2. Main Underwriter 3. Chief Underwriter. 1

414 1. Rs. 2500/- 2. Rs. 25000/- 3. Rs. 250000/- 4. Rs. 5000/- 2

415 Term Insurance Plan will give…. 1. Only Death Benefit. 2. Only Maturity Benefit. 3. Only Bonus Benefit. 4. Only Tax Benefit. 1

416 Low risk products give….. 1. High Returns 2. Low Returns 3. Moderate Returns 4. Good Returns 2

417 Who will maintain Mutual Fund Schemes? 1. Mutual Fund Management Societies 3

418 Which is the primary saving need among all saving needs? 1. Insurance 2. Purchasing House 3. Investment. 4

419 1. Insurance 2. Shares 3. Fixed Deposit in Bank 4. Mutual Funds. 3

What is the main source for insurance company to get information of proposer? 4. Telephonic conversations.

2. Number of premiums payable.

Mr. Kumar is taken one life insurance policy with ABC Company. But he is not satisfied with the policy benefits. What Mr. Kumar can do under this situation?

1. He can not do any thing, because be received the policy bond.

2. He can file a complaint against insurance company

in court.

3. He can send back the policy document to

insurance company with in 15 days from policy

receiving date.

4. Serve notice to insurance company on policy benefits.

2. Habits and Hobbies of Proposer.

3. Occupation and Residence of Proposer.

4. Medical and Personal History of

Proposer.

2. Present value of future earnings.

3. Present value of previous earnings.

4. Future value of previous earnings.

4. Information Underwriter.

Mr. Rajesh has taken policy from ABC insurance company for Rs. 500000 Sum Assured by paying Rs. 50,000 premium per year. Company declared 5% Simple Reversionary bonus, what is bonus amount?

2. Mutual Fund Management Systems.

3. Asset Management Companies.

4. Asset Maintenance

Company Limite4.

4. Contingency/ Emergency Fun4.

Mr. Rao has Rs. 10, 00,000 cash with him. He would like to use this amount for his daughter’s marriage which is going to happen with in Nine months. He would like to get some returns from this money in these 9 months period. What is the best option to park his money?

Page 36: Practice Questions (1) (1)

420 1. National Saving Certificates. 4

421 1. Rs. 3, 00,000/- 2. Rs. 4, 50,000/- 3. Rs. 90,000/- 4. Rs, 4, 85, 468/- 1

422 1. Collection Phase. 2. Accumulation Phase 3. Pension Phase. 4. Primary Phase. 2

423 1. Family Health Insurance Plans 2. Total Protection Policies. 3

424 1

425 1. Young Unmarried. 3. Retirement. 4. Children. 3

426 Which type of questioning is very useful to gather information from clients? 1. Closed Ended Questions 2. Open Ended Questions. 3. Interrogative Questions. 2

427 Perceived needs are those…. 1. Short term needs. 4. Long term needs. 3

428 Need analysis involves identifying……… 3. Existing insurance plans. 1

429 Which is the not part of KYC norms? 1. Photographs 2. Proof of identity 3. Proof of address. 4

430 Remuneration to Agents includes 1. First Year Commission 2. Renewal Commission. 3. Both of the above. 3

431 1. Switching 2. Churning 3. Redirecting. 4. Shifting. 2

Which of the following product not comes under Section 80 ( C ), income tax act 196

2. Equity Linked Saving Schemes.

3. Principle component of home loan.

4. Premium paid for Health Insurance

Plan.

Mr. Suresh purchase one pension plan and accumulated Rs. 9,00,000 amount in his pension fund. He would like to utilize commutation benefit before taking pension. What is amount Mr. Suresh can withdraw as commutation?

Customer has to pay the amount in regular intervals to create purchase price or Pension Fund. We call this phase as…..

Some Health Plans will give coverage for family members also. We will call these plans as…..

3. Family Floater Health Insurance Plans.

4. Family Rakshak Health Plans.

Mr. Hitesh would like to get health coverage along with Life Insurance. What are the options available to Mr. Hitesh to fulfill his need with a little cost?

1. Taking Life Insurance plan with Critical Illness Rider.

2. Taking Health Plan, Insurance Plan separately.

3. Taking Medi-claim plan with Life Insurance.

4. Taking Hospital Benefit Plan with

Endowment Plan.

Mr. Govind, Advisor with ABC life insurance company find out one client is seeking solutions for health care and inheritance planning. Which main life stage he most likely to fall into?

2. Young married with children.

4. Clarification Questions.

2. Imagined to be important by Advisor.

3. Imagined to be important by client.

1. Financial provision to meet predictable and unpredictable needs.

2. Capacity to pay the premiums in future.

4. Family and Employment details.

4. Lapsed policy details.

4. Salary and Reimbursement.

Mr. Gayaram, Advisor who advised the customer to close the old policy and take new one. But new policy does not have any extra benefits but it will give more commission to Mr. Gayaram. This is called as……

Page 37: Practice Questions (1) (1)

432 An insurance agent is intermediary between…. 1. Client and Insurance Company 3. Client and IRDA 1

433 What is the factor which has influence on persistency? 1. Role of Agent 2. Product Design. 3. Policy Servicing 4. All of the above. 4

434 What is meant by a claim under insurance policy? 4. All of the above. 2

435 Who will take the initiation to settle the maturity claim process? 1. Client 2. IRDA 3. Advisor 4

436 Which is the right statement regarding claim enquiry? 1

437 1. Layering 2. Placement 3. Integration 4. Amalgamation. 1

438 2. Reserve Bank of India. 3

439 How many ombudsmen offices located in India? 1. 10 2. 12 3. 14 4. 15 2

440 3

441 Ethics can be defined as… 4. All of the above. 4

442 Which is not unethical behavior in below statements? 1. Over selling of Insurance policies. 4. Churning. 3

443 1. Risk retention 2. Risk transfer 3. Risk avoidance 4. Risk tolerance 2

2. Insurance Company and IRDA

4. Insurance and Re-insurance

company.

1. A demand to fulfill the policyholder’s obligations.

2. A demand to fulfill the insurer’s obligations.

3. Any demand made by the policyholder on the

insurer.

4. Insurance company

1. The insurance company makes enquire only on death claims.

2. The insurance company makes enquire on maturity

claims only.

3. Enquiry will be done on both Maturity and Death

Claims.

4. Enquiry will be done if death

happens before one year from policy inception date.

Which is the 2nd stage in Money Laundering?

Who controls and regulate the rates, advantages, terms and conditions that may be offered by insurers in the respect of general insurance business.

1. Insurance Regulatory and Development Authority.

3. Tariff Advisory Committee.

4. Insurance Institute of India.

What the name of department that is established by IRDA to deal with customer complaints?

1. Customer Complaint Department (CCD)

2. Customer Grievance Department (CGD)

3. Consumer Affairs Department (CAD)

4. Consumer Protection

Department (CPD)

1. Those values we commonly hold to be “good” and “right”.

2. Behavior that is based upon the moral judgments of

an individual

3. A study of what makes one’s own actions right or

wrong.

2. Under selling of Insurance policies.

3. Explaining all details of the policy to customer.

Mr. Mahesh is a software engineer. He has taken a term insurance for Rs. 30,000,00/- for 30 years. This is an example for-----------------

Page 38: Practice Questions (1) (1)

444 Which of the following do not include the channel of indirect marketing? 1. individual agents 2. bancassurance 3. insurance brokers 4. through internet 3

445 Which of the following can be an example of moral hazard? 1. a family history of heart disease 3

446 The business of Insurance is connected with................ 1. physical values of assets 2

447 Human beings need life insurance because.................. 1. death is certain 2. death is uncertain 3

448 Life insurance the risk is determined on the basis of .......... 1. future data 2. past data 3. statistical data 2

449 Where do you not find insurable interest in the following options......... 1. surety-co surety 2. employee-employer 3. husband-wife 4. brother-sister 4

450 The principle of utmost good faith applies to........... 1. only insurers 2. only proposer 3

451 When an illiterate person wants to have a policy..... 1

452 3

453 Which of the following statement is not true in connection with nomination? 3

454 Which of the following statements in correct in connection with assignment? 1

455 2

2. a person working in a chemical factory

3. a person consuming alcohol

4. A teacher working in a primary school.

2. economic values of assets

3. metaphysical values of assets

4. market values of assets

3. the timing of death is uncertain

4. Death is the solution.

4. mathematical data

3. both insurers and proposer

4. neither insures nor proposer

1. an impression of the left thumb is taken and third party has to attest it

2. an impression of the left thumb is taken and the advisor has to attest it

3. an impression of the left thumb is sufficient and need not be attested

4. A relative of the illiterate person has to sign on behalf of

that illiterate person.

Mr.Shanth has taken an endowment policy of 15 years with ABC insurance company. He has paid premium for 4 years and he could not pay premium for 5th and 6th year. In the 7th year he approaches the company to renew the policy. Now which of the following options will apply to him?

1. The policy will be renewed on the existing terms and conditions.

2. Mr. Shanth cannot renew the policy

3. the policy may be renewed on different terms

and conditions

4. Mr. Shanth can renew the policy

only on the approval of the insurer

1. The life insured can nominate one or more than one person as nominees.

2. Nomination can be done either at the time the policy

is bought or later.

3. A person having a policy on the life of another

should make a nomination.

4. The section 39 of the Insurance Act

1938 speaks about the nomination.

1. Assignee cannot make fresh nomination in the policy

2. The assignor need not be major at the time of

assignment.

3. Section 45 of the insurance act speaks about

assignment.

4. Conditional assignment and

absolute assignment are one

and the same.

Mr. Shanth has taken an endowment policy of 20 years. He has paid premium for 10 years and now the policy is in force. At this point of time can Shanth take loan?

1. Mr. Shanth will not be granted any loan

2. Mr. Shanth can take loan which should be certain

percentage of the surrender value of the policy.

3. There is no concept of loan in insurance policy

4. loans are allowed only in term plans

Page 39: Practice Questions (1) (1)

456 The underwriter can get the required information about the proposer in..... 1. Proposal form. 2. renewal receipt 3. brochure 4. annual report 1

457 Mr. Ramesh works in a mining company. So he is exposed to.............. 1. moral hazard 2. physical hazard 3. mental hazard 4. Ethical hazard. 2

458 Lien is imposed on a policy when underwriter feels that...... 1. the risk associated might increase 2

459 The income of an individual can be protected with the help of......... 1. a unit linked policy 2. a term life policy 3. an endowment policy 2

460 1. when he dies 3. when he is hospitalized 2

461 The disposable income means...... 1

462 1. high 2. low 3. normal 4. Neutral. 2

463 Which of the following ways is easier for a person to take a saving product? 1. through individual agents 2. through internet 3. corporate agents 4. call centers 2

464 1. Fixed deposits 3. Term Insurance 4. Endowment plans 2

465 1. Life Insurance 2. Mutual fund 3. Shares 4. Bank deposits 4

466 Which of the following is not a feature of WOP rider? 4

467 1. immediate annuity 2. life annuity 3. deferred annuity 4. joint life annuity 3

2. the risk associated might decrease

3. the risk associated might not be harmful

4. the risk associated might be

general

4. a money back policy

Mr. Shanth has got a pure endowment policy for 30 years for the sum assured of Rs. 75,000,00/-. It can be paid to him......

2. when he survives the term

4. when he loses his job

1. the surplus amount that can be invested

2. the amount that can be paid towards one's EMIs

3. the annual bonus amount

4. the sum of one's all investment

Mr. Shanth is in his early 20s and has just started earning. His risk appetite is expected to be.....

Flexibility like partial withdrawal and taking premium holidays is possible with....

2. Unit linked Insurance plans

Mr. Rajgopal has invested some money. He has been informed clearly about the tenure, interest rate and method of payment of interest at the inception of the investment itself. His investment may be in.....

1. The rider waives future premiums in the event of the disability or death of

the policy holder.

2. This rider is ideal for helping to prevent a policy

lapsing due to non-payment of premiums due to death or

disability

3. The main strength of WOP is the payment of full

sum assured.

4. WOP rider can be offered with all plans

Mr. Ramakant is 35 years old. He has bought retirement plan for 20 years. This type of pension plan is known as..................

Page 40: Practice Questions (1) (1)

468 2

469 The younger the age of an individual..............their liabilities will be. 1. the lower 2. the higher 3. the smarter 4. the superior 1

470 1. Pre-retirement stage 2. Post retirement stage 1

471 1. Real need 2. Perceived need 3. Imaginary need 4. Important need 2

472 During the recommendation stage the advisor needs to...... 1

473 For an insurance advisor churning is.............practice 1. good 2. bad 3. compulsory 4. appreciable 2

474 1. 30 % 2. 35% 3. 40% 4. 45% 2

475 In the case of agent's death, the commission payable will be paid to......... 1. his legal heirs 2. to his nominee 3. will stop automatically 1

476 1. Normal death claim 2. Early death claim 3. Abnormal death claim 2

477 Detailed Investigation will be triggered in case of...... 1. Maturity claims 2. All death claims 3. Early death claims 3

478 1. 5 years 2. 6 years 3. 7 years 4. 8 years 3

479 In the process of settling maturity claims.... 2

Mr. Ranga has taken Critical Illness Rider. In which of the following scenarios the insurance company will pay him......

1. When Mr. Ranga dies due to critical illness

2. When Mr. Ranga is diagnosed a critical illness

3. When Mr. Ranga's family member will be in

critical illness

4. When Mr. Ranga dies due to severe

road accident.

Mr. Ramachandra's son Mr. Bharat has just employed as a software engineer, daughter Anusha has got married. Now Mr. Ramachandra is free from his burden. So Mr. Ramachandra is now in the ...................stage.

3. Married with older children stage

4. Employment stage

Mr. Vinodh has lot of inconvenience to reach office every day. So he wants to buy an expensive car when he will have sufficient fund. Here Mr. Vinodh's need is.............

1. recommend the products that best meet the client's needs

2. recommend to wait some days to invest

3. recommend the new product the company has

recently launched

4. Recommend to take his own time to

take a decision.

According to IRDA regulations the maximum percentage of first year commission to be paid to an insurance advisor is.............

4. Paid in lump sum to the survivors.

Mr. Chintamani has taken a policy from ABC Company on 2nd March 2010, but unfortunately he died on 18th August 201 His death claim is considered as..........

4. Unnatural death claim

4. Rider benefit claims.

In insurance, if a person is not heard for .......years his is presumed to be dead.

1. the company will wait until the claimant comes to office to demand the

claim

2. the process is initiated by the company well in

advance of the maturity date

3. it is the responsibility of the claimant to approach

the company

4. If the claimant does not come

within a month the entire maturity amount will be

forfeited.

Page 41: Practice Questions (1) (1)

480 Issuance of a license to a person has been stipulated in................Act 1. Section 43 of the Insurance Act 1939 2

481 The Insurance Institute of India (III) was formed in..... 1. 1956 2. 1999 3. 1955 4. 1947 3

482 The insurance ombudsman has been appointed to protect the interest of....... 1. policyholders 2. shareholders 3. insurers 4. General insurers. 1

483 1. IRDA 2. Agents 3. Shareholders 4. Underwriters 2

484 1. ethical 2. unethical 3. professional 4. Perfect. 2

485 The code of conduct has been prescribed in India by........... 1. IRDA 2. Insurance Council 1

486 Which one of the following is possible in retaining the risk? 2

487 The timing of death is uncertain, so when one should take life insurance? 1. At the time of uncertainty 2. At an early age 3. Anytime in life 2

488 Insurance Protects which of the following? 3

489 What does the mortality tables contains ? 4

490 4

491 1. Under the category of Pure risk 1

2. Section 42 of the Insurance Act 1938

3. Section 12 of the Insurance Act 1922

4. Section 34 of the Insurance Act 1932

The charges were not fully disclosed to the customers" is a common complaint against.....

Mr. Sharma is a newly recruited insurance advisor. To meet his month target he explains only the good points of newly launched plan to his customer. Here Mr. Sharma's behavior is............

3. Insurance Institute of India

4. Government of India.

1. Retaining the ownership in the policy 2. Not possible as life has many risks.

3.Is possible by transferring risk to the policy holder

4.Is possible by Re-insuring oneself

4. At the time when Advisor takes the

decision

1. The life of the person paying compensation

2. The risk retained person 's family

3. The financial goal of the insured

4. The life of the nominee

1. Tables of death occurring in various circumstances

2. Tables of details of various probabilities of death

3. Tables of details of underwriter’s calculation on

death

4. Tables of details of actuarial

calculation on death

Mr. Guptha is recently detected with lung cancer. He would like to take an insurance. What is your suggestion?

1. Time of death is uncertain, so insurance can be given

2. Only lung is affected so health insurance can be

given.

3. He can take insurance after submitting health

certificate

4. Cannot give insurance for health

reason

On 6th August there was a typhoon. Mr.Augustin who had insurance died in typhoon. Now how will the insurance company will categories this particular risk ?

2. Under the category of peril risk

3. Under the category of particular risk

4. Under the category of Risk

Transfer

Page 42: Practice Questions (1) (1)

492 1. Consideration in the contract 2. Capacity to contract 3. Consensus ad idem 4

493 Agent who is a licensed intermediary is actually is ? 2

494 3

495 1. He can take Surety insurance 3

496 2

497 1

498 1

499 3. Date the policy matures 2

500 1. A . Physical hazard, as he is old 3

501 1. Financial Inspection agencies 4

502 1. Risk Analysis Department 3. Underwriter 3

503 In underwriting the economic value of the person is determined by what? 1. The occupation of the person 4. Human Life Value 4

Mr.Akash filled the proposal form but before submitting to the company he discussed with the agent that he is not sure whether he can pay for 15 years . This attitude affects which part of the contract?

4. Offer and Acceptance in the

contract

1. A legal person to act on behalf of the re-insurer

2. B.A legal person to act on behalf of the insurer

3. C.A legal person to act on behalf of the contract

4. D. An authorized agent to act on

behalf of the legal company

Mr.Karan who has to go to abroad for 6 months on an official work decides to leave his car with his friend Mr. Jim. What will be the validity of the insurable interest in this case ?

1. The insurable interest between the car and jim is valid for 6 months

2. The insurable interest between the car and karan

is valid for 6 months

3. The insurable interest between the car and karan

is valid until he owns it

4. The insurable interest between the car and Jim is valid until Karan’s return

Mr. Varun who own a multi chain company would like to take an insurance. What will be the best option for him from the following ?

2. He can take Business Partner insurance

3. He can take Key man Insurance

4. He Can take company insurance

Mr. Josh was filling the proposal form but as his mother was sitting beside him, even though he drinks and smokes he ticked “NO” in smoking & drinking column of proposal form. This indicates ?

1. He has breached the non-disclosure of the fact

2. He has breached the company by concealing the

facts

3. He has breached the company by fraudulent

information

4. He had done an innocent

misrepresentation

Mr.Feroz has taken policy for critical illness worth Rs.1 lakh in health policy. He also has a term plan worth Rs.10 lakhs. Mr.Feroz was hospitalized after he was detected with cancer .Unfortunately he died after 3 days of treatment. How the claim will be settled?

1. claim of critical illness and 10 lakh from term policy will be settled

2. claim of hospital charge Rs 20,000 and 1 lakh for

death will be settled

3. Claim will not be settled as he died due to cancer

4. Claim will be settled as per the

instructions of underwriter

Mrs.Shwetha has taken a loan from her policy. Later stage she neither paid back neither the loan nor she paid the premium for a very long time. What will happen to her policy?

1. Policy will be surrendered by the insurer

2. Policy will be surrendered by the nominee

3. Policy will be surrendered by the

company

4. Policy will be surrendered by the

heir

Which of the following information does not appear in the First Premium Receipt?

1. method and frequency of premium payment

2. Date of commencement of last premium

4. Date the last premium will be paid

Mr.Santhosh working as a head master who is around 52 years had requested for an Insurance cover for Rs.1 crore. He insisted that his brother’s son should be the nominee not his wife. Underwriter will verify this case for which one of the following:

2. B. Moral hazard, as he is 52 years old and wife is not

the nominee

3. C. Moral hazard, as coverage is high and brother’s son is the

nominee

4. D. Moral hazard, as he is a head

master and 52 years old

Mr.Feroz has applied for an insurance cover of Rs.4 crores. The Company will accept or reject the proposal only after confirming from one of the following agencies.

2. Specialized inspection agencies

3. Credit worth inspection agencies

4. Insurance Investigation

Agencies

The responsibility for classification and analysis of the proposal form lies with whom?

2. Classification of Risk Department

4. Actuary who analysis the risk

2. The financial history of his family

3. The income that he earns

Page 43: Practice Questions (1) (1)

504 1. Salary saving Life plan 2. Not a specific plan 3. Salary insurance plan 2

505 1. Mutual Fund 2. Risk Diversified Insurance 3. Shares 1

506 1. Capital Appreciation 2. Capital Profit 3. Capital Benefit 4. Capital Variation 1

507 1. Pension Funds 2. Public Provident Fund 3. Employee Gratuity Fund 3

508 Which official body decides to increase the interest rates? 1. Central bank of India 2. Reserve bank of India 3. Reserve bank of country 2

509 1. Bombay Share exchange 2. Bombay Stock exchange 3. Stock brokers 4. Share brokers 2

510 Which one of the following cannot be covered under Critical illness rider? 1. Blindness 2. Paraplegia 3. Coma 4. Brain Surgery 4

511 1. Guaranteed period annuity 2. Life annuity 3. Deferred Annuity 4

512 Which are the two primary needs of any customer in any point of life? 1. Investment and retirement 2. Investment and Protection 3. Investment and savings 2

513 1. Converting the policy to Term policy 2

514 1. Fact Finding Sheet 3. Customer Data sheet 1

515 1. Fact Finding document 2. B.KYC document 3

Mr. Kumar decides that his employees should have SSS scheme. What type of plan is SSS?

4. Salary Specific plan

The concept of Risk diversification is applicable in which of the following instrument ?

4. Risk Sharing insurance

Ajay bought a share for Rs.110 and he sold when it was Rs.630.What had happened to his share?

Which of the following can’t be ducted under section 80 c from taxable income?

4. Infrastructure Bonds

4. Central bank of country

Who act as an intermediary by offering a trading platform for buying and selling of shares? Chap-6

Mr. Yash has taken an annuity on 25th August 201The benefit of the plan will start from 25th August 201 What type of annuity plan is this?

4. Immediate annuity

4. Investment and life needs

Mr. Raj has taken a policy of 15 year term. He has paid the premium for 9 years. But now unfortunately he has lost his job. He is unable to pay the premium. What can be the best solution from the following ?

2. Converting the policy to Paid up

3. Converting the policy to money back

4. Converting the policy to whole Life

In which of the following an agent will collect the customer’s Personal data, professional data and financial data

2. Advisor Confidential Sheet

4. Personal and financial data sheet

Mr.Mohith, an agent was explaining to his customer the guaranteed benefits of the product. Which one of the following documents he would have used to explain the same?

3. C. Benefit illustration document

4. D. Client benefit document

Page 44: Practice Questions (1) (1)

516 3. Client’s business details 1

517 Which one of the section deals with the licensing of an agent? 1. Section 42 of the insurance act 1938 1

518 Which one of the following factor does not help in the Persistency ? 3

519 1. Churning of the policy 2. Surrendering the policy 3. Switching the policy 1

520 Which regulations take care of the settlement of claims ? 1

521 3

522 Which of the following team represents the members of GBIC ? 1

523 1. Life insurance council 1

524 1

525 1. Nodal officer 2. Grievance call center 3. Compliance cell 1

526 1. Policyholder grievance Regulation 3. Ombudsman Regulation 2

527 3. Agent will be terminated 3

Mr.Harsha an agent wants do a thorough Fact Finding for his client to Mr.Kishan who is a business man. Which of the following information will be helpful to know about the earnings and Expense of Kishan?

1. Client’s Profits and Withdrawals from business

2. Client’s Expense statement

4. Client’s business records

2. Section 42 of the insurance act 1936

3. License section of Insurance act 1938

4. License section of insurance agent act

1938

1. Regular reminders about the premium to the customer

2. Flexibility of Premium payment to the customer

3. Dispatching Discharge voucher to the customer

4. Continuous servicing of the

policy

Mr. David an agent had helped Mr. Srinivasan to take an endowment policy on Feb 200As srinivasan was finding it difficult to pay the premium, Mr. David had advised him to surrender this policy and to apply for a lower premium policy. This is called as ?

4. Claiming the policy

1. Protection of Policy holder Interests regulation 2002

2. IRDA claim protection regulation 2002

3. C.IRDA policy settlement regulation 2004

4. D. Protection of claim settlement regulation 2002

Mr.Baskar had taken a Term plan for a sum assured of Rs. 7 lakhs. He also has an ADB rider worth Rs. 4 lakhs. Unfortunately Baskar died in a car accident. How much will be the death claim settlement?

1. Total 7 lakhs will be paid as death had taken place

2. Total 4 lakhs will be paid as death had happened due

to car accident

3. Total 11 lakhs will be paid

4. Total 7 lakhs will be paid without any

deduction.

1. Representatives from all insurance companies

2. Representatives from all government bodies

3. Representatives from IRDA

4. Representatives from Insurance institute of India

Which council among the following focus on creating a positive image of the insurance industry and would also like to enhance the Consumer’s confidence on the same ?

2. Consumer insurance council

3. National Insurance council

4. General insurance council

Mr.Varun taken up his agency in July 5th 200 His lost his IRDA license while travelling. His agency has also expired. What is the solution for Mr.Varun ?

1. Need to complete 25 hours of practical training and paying Rs.50 for

the issuance of duplicate license

2. Need to complete 50 hours of practical training and paying Rs.100 for the

issuance of duplicate license

3. Need to complete 25 hours of practical training and paying Rs.100 for the

issuance of duplicate license

4. Need to complete 50 hours of IRDA

training and paying Rs.50 for the issuance of

duplicate license

If any consumer is dissatisfied with the customer care cell of any insurance company to whom they can escalate their grievances.

4. Compliance officer

Which is the Regulation that insists that all the insurance companies should provide the information about the insurance ombudsman of that region while sending the policy documents.

2. Policyholder’s Protection regulation

4. Compliance Regulatory

Mrs. Hansa an agent, has planned to sell maximum products within a short span of time by giving maximum rebates to the customer to complete the contest target of the company.

1. It will benefit both the company and the customer

2. Reputation of the company will be high due to

offers to the customer

4. Agent will be qualified for the

contest

Page 45: Practice Questions (1) (1)

528 2. Raghav will be terminated 3

529 The concept of need based selling involves 1. Selling what company wish to sell. 3

530 E-sales refers to sales of insurance products through 1. Insurance brokers. 2. Bancassurance. 3. Individual agents. 4. Internet. 4

531 1. Company’s code of conduct. 3

532 Life insurance company determine the level of risk based on 1. Future expenses. 2. Claim experiences. 3. Present expenses. 2

533 1. Speculative. 2. Particular. 3. Financial. 4. Fundamental. 3

534 In Insurance terms, pooling of risk is 4

535 A contract exists between insurer and proposer when 1

536 1. Innocent misrepresentation. 3. Concealment. 4. Non-Disclosure. 4

537 1. Indemnity contract. 2. Value contract. 3. Deemed contract. 4. Rolling contract. 1

538 Payment of premium and sum assured are laid down in 1. Heading of policy document. 2. Proviso of policy. 3. Operative clause. 3

539 An insurance contract commences when 1. Quotation is signed by proposer. 3. Proposal Form is signed. 2

Mr.Raghav is an expert in fact finding .Mr.Raghav helps his brother in his job by sharing the information of his clients after the fact finding he does to procure insurance. What will be the outcome ?

1. Raghav will be promoted to the next level

3. Raghav License will be cancelled

4. Customer will complain to

Ombudsman

2. Selling what adviser wish to sell.

3. Selling what customer requirement is.

4. Selling what IDRA wants

company to sell.

Rahul is a licensed insurance agent. As agent he must carry out his role in accordance with

2. IRDA Acts code of conduct.

3. IRDA Regulations code of conduct.

4. Insurance Acts code of conduct.

4. Targeted bonus rates.

Ram works in a Fire cracker factory. He stocks the cracker in his house. He runs which type of risk.

1. Using the same pool for paying claims of car & life insurance.

2. Using different pool for paying claims of life

insurance.

3. Using the same pool for paying claims of life &

house insurance.

4. Using the same pool for paying claims of life insurance.

1. A proposal has been accepted by insurer.

2. A policy document has been stamped by insurer.

3. A policy document has been received by the

policyholder.

4. An insurer has made another

proposal.

Rakesh purchased a life insurance policy. While writing a proposal form he hide that he practices mountaineering. Sadly he died in an accident while climbing Mount Everest. The insurers rejected the claim.What is the reason for rejection?

2. Fraudulent misrepresentation.

Shamsher has a health insurance policy of ` 1, 00,000 individually and from his company for ` 2, 00,000. He falls sick and got hospitalized. His hospital bill ran to ` 50,000. He claimed this amount from his individual policy. Also, he placed the request with his company for group policy claim, which was rejected. The reason for rejection is.

4. Schedule of policy document.

2. First Premium Receipt is issued.

4. Policy Document is received by policyholder.

Page 46: Practice Questions (1) (1)

540 When is premium considered / deemed to be paid? 2

541 1. Terms & Condition. 2. Preamble. 3. Endorsement. 4. Schedule. 3

542 1. Acquires surrender value. 3. Moneys will be forfeited. 4

543 How assignment distinguishes itself from nomination? 1

544 When an underwriter may consider Moral Hazard? 3

545 Level Premium is calculated based on 1. Risk Premium. 2. Net Premium. 3. Loading of Premium. 4. Gross Premium. 1

546 MPL abbreviates 1. Minimum Possible Loss. 2. Major Possible Loss. 3. Minor Possible Loss. 4

547 1. Clause. 2. Assignment. 3. Lien. 4. Level Premium. 3

548 1. Endowment Plan. 2. Money Back Plan. 3. Whole Life Plan. 4. Term Plan. 4

549 1. 10% of S1. 2. 20% of SA. 3. 30% of SA. 4. 40% of SA. 2

550 The savings needs of a particular individual is majorly determined by 1. Amount of disposable income. 2. Current assets. 3. Current liabilities. 4

551 1. High Risk. 2. Low Risk. 3. Moderate Risk. 4. No Risk. 1

1. When insured writes a cheque in favor of insurer.

2. When cheque amount is deposited in insurer

account.

3. When the cheque is deposited with insurer

office.

4. When cheque is posted/couriered by

the insure4.

Ram Lal is an insurance policyholder. He has recently shifted his home from New Delhi to Noida. He wants the address to be changed. This change in policy document will be effective through?

Lalu Yadav is having a saving plan with 20 years tenure. He has paid 5 annual premiums but due to financial crisis is unable to make future premium. His policy

2. Contract comes to an end.

4. Acquires paid up value.

1. Nomination does not transfer the title while assignment does.

2. Nomination transfers the title while assignment does

not.

3. Nomination is made after policy is issued while

assignment is done before it is issued.

4. Nomination need not be informed but assignment needs

to be informe4.

1. An individual is proposing SA 15 times his annual income.

2. Insurance is taken out by an individual with

dependents.

3. A nominee is not a dependent.

4. A medical checkup is carried out nearby place of

residence.

4. Maximum Possible Loss.

What is generally considered as a substitute to charging a high premium for a high risk?

Manmohan has recently purchased a house worth ` 50, 00,000 on loan. Which insurance product you as an adviser will suggest?

To avail the income tax benefit at investment stage, premium should be maximum

4. Duration of investment.

For his investment need, Ravi has parked funds in equity. The returns from this form of investment can be categorized as

Page 47: Practice Questions (1) (1)

552 1. Taxation only. 2. Inflation only. 3. Taxation & inflation both. 3

553 1. Retirement need. 2. Tax planning need. 3. Financial security need. 3

554 1. Likely to increase. 2. Likely to decrease. 3. Will fluctuate. 2

555 1

556 4

557 1. Equity. 2. Bank fixed deposits. 3. Health insurance plan. 3

558 1. 1/5th of accumulated amount. 2

559 1. Prioritize, Identify & Quantify Needs. 2

560 3

561 1. Objection handling skills. 2. Listening skills. 3. Communication skills. 1

562 The objective of Fact Finding is to 1. Gather Clients Information only. 4

563 To explain the benefits of a product, the insurance adviser should 2

While calculating the expected returns from investments and savings, an individual should make provisions for

4. No provision is require4.

Vijay, aged 30 years and married, is the sole bread winner for his family. He is saving enough with banks.As an agent, which need you prioritize first?

4. Asset building nee4.

The Central Bank has recently announced the decrease in interest rates. The prices of bonds are

4. No change is likely.

Rohit is working as sales manager with an FMCG company. His job requires him to travel across states. He is planning of covering his additional risk involved while travelling and a savings plan. What suggestion would you give him as an agent?

1. To purchase an accidental rider with a savings insurance plan.

2. To purchase a health plan along with a savings

insurance plan.

3. To save through fixed deposits in bank.

4. To purchase a medical plan.

The general need for purchasing a health insurance plan at an early age results from which of the following factors?

1. The premium decreases with increasing age.

2. The premium remains constant with increasing

age.

3. The premium may increase or decrease with

the increasing age.

4. The premium increases with increasing age.

The life expectancy in India is constantly improving and is well above 60 years. This also brings along challenges. These challenges can be covered through

4. Savings insurance plan.

Anand has purchased a pension plan which is nearing completion of accumulation phase. He is in need of finances to make down payment of car he wants to purchase. At the end of accumulation phase how much he can make tax free withdrawal?

2. 1/3rd of accumulated amount.

3. 2/5th of accumulated amount.

4. 2/3rd of accumulated

amount.

During the fact finding session as an agent you should follow which one of the following process?

2. Identify, Quantify & Prioritize Needs.

3. Quantify, Identify & Prioritize Needs.

4. Prioritize, Quantify & Identify

Needs.

As an adviser why is it essential for you to carry out the financial planning exercise with the prospective clients?

1. Individuals understand their real needs and can prioritize them.

2. Individuals have same financial needs at different

stages of the life cycle.

3. Individuals do not understands their real

needs and cannot prioritize them.

4. Individuals’ real and perceived

needs are same.

After undertaking financial planning exercise, the prospective client said that he does not have funds for investments. To resolve this query, which skill of an agent would be tested?

4. Client information gathering skills.

2. Identify only the client’s needs.

3. To provide solution of company’s choice.

4. Both identify clients’ needs &

gather information.

1. Provide the product brochure to the client.

2. Provide Benefit illustration documents to client.

3. Provide the terms and conditions document to the

client.

4. Provide the website address to

the client.

Page 48: Practice Questions (1) (1)

564 The agents duties and responsibilities ends 1. When the clients policy is issued. 4

565 2

566 3

567 What key benefit high persistency ratios have on insurance adviser? 1. High renewal income. 2. Less renewal income. 3. Fewer client bases. 1

568 Insurer will not pay the claim unless 1. The policyholder makes a demand. 3

569 1. The policy was not in force. 3. The claim is fraudulent. 1

570 1. The claim may not be genuine. 2

571 1. The circumstances are legitimate. 4

572 Under Married Women’s Property Act, 1874 a policyholder is 1. The Life Assured. 2. The beneficiaries. 3. The trustee. 3

573 Who has the authority in insurance company to issue/cancel the agents license 1. Insurance Company. 2. Designated Person. 4. Actuary. 2

574 1. Institute of Actuaries of Indi1. 4

575 1. 10 Days. 2. 15 days. 3. 20 Days. 4. 30 Days. 1

2. When the client’s needs have been established.

3. When the nominee has changed.

4. When the maturity/claim is

settle4.

When client declines the recommendation by the insurance adviser even after resolving the concerns, the adviser should

1. Persuade the client to purchase the policy.

2. Should ask for reference who might be interested in

financial planning.

3. Should never approach the client ever again.

4. Should do nothing.

Under what circumstances the surrender of a policy should be recommended by the agent?

1. When a client have been sold the right solution.

2. When a client is holding a product having good value

for money.

3. When the policy has been mis-sold and do not

match his needs.

4. When the client is enjoying good

financial status.

4. Unsatisfied clients.

2. The nominee makes a demand.

3. The event insured against happens.

4. The insurer completes the

enquiry.

Aman has taken a term plan for 20 years. In the 3rd year he suffered financial crisis due to which he was unable to pay premium within grace period and died after 1 month. The nominee files a claim and is rejected because

2. This condition is excluded in the policy.

4. The claim is an early claim.

When a policy is lost, insurance company take utmost care while settling maturity claims because

2. The policy may be pledged.

3. The facts were misrepresented.

4. There is no nomination.

What key event is most likely to make an insurance contract not a valid contract?

2. Representation of facts by the policyholders is true.

3. The life assured is major.

4. There is no insurable interest attached to the

policy.

4. The administrator.

3. Branch Operations Team.

Which organization was formed with purpose to promote insurance education and training in India?

2. National Insurance Academy.

3. Chartered Insurance Institute.

4. Insurance Institute of India.

A client demands the information on the current status of a policy indicating accrued bonus. The insurer should provide communication within

Page 49: Practice Questions (1) (1)

576 4

577 2

578 1. Underselling of insurance policies. 2. Churning. 3

579 Insurance business is classified into three main types: 1. Life, Non –life, Micro Insurance. 3

580 1. Property Insurance 2. Life Insurance 3. Health Insurance 4. Liabilty Insurance 2

581 [email protected] [email protected] 4

582 1. Pure Risk 2. Pooling of Risk 3. Insuraable Risk 4. Sharing of Risk 2

583 1. Pure Risk. 2. Particular Risk. 3. Financial Risk. 4. Insurable Risk 1

584 which of the following refres to specific event which might cause a loss ... 1. Peril 2. Hazard 3. Physical hazards 4. Uncertinity 2

585 1. Loan assignment 2. Conditional Assignment 3. Loan Agreement 2

586 1. Endowment Plan 2. Term Plan 3. Money Back Plan 4. Annuity Plan 1

To ensure that the customers complaints are handled effectively, IRDA has established

1. Integrated Grievance Management System.

2. Internal Grievance Redressal Cell of the

Insurer.

3. Grievance Redressal Officer.

4. Consumer Affairs Department.

Amit & Rashmi are newly married. Both are working couple. They want to invest their savings of 100,000 annually to build corpus to make down payment for their house 5 years from now. An adviser sold than a unit link product to meet their requirement. This may result in

1. Ruining the long term reputation of company.

2. Opportunity of new business for adviser.

3. Bad reputation of the individual adviser.

4. Financial burden on the couple.

Shankar, an adviser, sold a term insurance policy and unit-linked insurance policy (ULIP) to Amar, the client, who is unmarried and has no dependent. Consequently, Shankar’s action can be termed as

3. Overselling of insurance policies.

4. Ethical practice by an adviser.

2. Life, Non Life, Miscellaneous

3. Life, Non life, Re-insurance.

4.Life, Health, Micro Insurance

Amit is looking for term insurance plan for protection of his family, he is advised to approach to:

Insured can contact to seek the resolution of grievances they have against insurer to IRDA through:

[email protected]

[email protected]

An Insurance company pools the premium collected from several Individual to insure them against similar risk is called:

Which of the following Risk is associated with those events which are not in control of an individual and also no possibility of making profit:

Manish took a loan from Pankaj of Rs.10 lac, Pankaj transferred his Insurance policy to Manish of Rs.10 lac as a security with the agreement Of when Loan is fully paid, policy title will be revert back to name of Manish is called:

4. Absoulte Assignment

Rakesh has bought an Endowment, Money back, Term & Annuity Plan he would like to avail Loan from:

Page 50: Practice Questions (1) (1)

587 1. Nominee 2. Legal heir of life Assured 3. Debotrs 2

588 1. An Age Proof 2. An Identity Proof 3. An Address Proof 4. Education Proof 4

589 Life Insurance also known as: 1. Value Contract. 2. Indemnity 3. Commercial Contract 4. Speculative 1

590 1. Lien Clause 2. Opertaive Clause 3. Proviso Clause 2

591 1. Nominee only 3. Appointee Only 2

592 3.Lien Clause 1

593 1. Non Standard Age Proof 2. Standard Age proof 3. an Address proof 2

594 1. Simple Revisionary bonus 3. Persistency Bonus 4. Interim bonus 3

595 1. Gross Premium 2. Level Premium 3. Risk Premium 4. Net Premium 2

596 Which one of the following is not source of information about the 1. Proposal Form 2. Insurance agent 3. neighbor of proposer 3

597 1. Physical Hazard 2. Moral Hazard 3. Medical 4. No underwriting 2

598 In Group insurance plans contract of insurance between …………? 1. Master Policy holder & insurer 2. Employer & Employee 3. Employee & Insurer 1

On foreclosure, if Death claim arises before the payment of the surrender value, the payment would be payable to:

4. forfeited the Premium

To prove one’s identity in accordance with KYC process, the customer needs to submit following document excluding ……….?

Which clause lays down the mutual obligation of the parties regarding, Payment of Premium by Life assured & payment of Sum Assured by

4. Schedule of Policy

Gaurav is working in MNC at the age of 32 bought an Endowment Plan. He had nominated his 1 year old daughter Saanvi, but not able to get the Signature of her appointee due to unavailability of his spouse .after 5 year. He died in road accident, now claim money would be payable to:

2. Legal heir of the life assured

4. will be Payable to Saanvi (Nominee) at

the age of 18th

Parvesh bought a policy an endowment plan but after one year insurer. Found he had Aorta Surgery .now which will apply by insurer:

1. Indisputability Clause (Section 45) apply

2.Principal of Indemnity apply

4.Utmost good faith apply

Jyoti is submitting is copy of permanents account number card as age proof for buying an money back plan .her age consider as a

4. Proof of Income tax payer

Which one of the following bonuses is given by insurer as an incentive to the insured to for long term:

2. Compound Revisionary bonus

Ramesh bought an endowment plan for tern year he pays the same Amount in every year is called:

4. Medical of examination report

Manish being a sole earning member of his family not insured himself But looking for insurance for his son who is student .there is possibility of

4. Creditors & Debtors

Page 51: Practice Questions (1) (1)

599 Which option is not correct with regard to joint life insurance plan? 2

600 Time deposit account is issued by: 1. Post office 2.Bank 3.Mutual Fund 4. Life Insurance co. 1

601 1. Corporate Bond 2. Infrastructure Bond 3. Health Insurance 2

602 1. Saving Deposit 2.Cumlative deposit 3. Traditional Deposit 4. Fixed Deposit 3

603 Vinod being an insurance agent can offer assistance to his client Ramesh by: 1. Providing him emergency fund. 2

604 Which of the following is not featured and benefit of rider? 1. Providing additional cover 2. Maturity benefit 3. Nominal cost & flexibility 2

605 1.10 lac 2. 20 lac 3.30 lac 4.5 lac 2

606 What do you mean by Double Income Family? 2

607 In which of the following case there is no defined retirement age? 1. Public sector employees 2. Private sector employees 4. All of the above 2

608 Which one of the following is true? 2

609 Objectives of fact-finding do not include- 1. Identify needs 2. Gathering client data 4

610 1. KYC documents 3. Fact-finding sheet 4. Financial details 2

1. Plan offer insurance coverage for two person in one policy

2. This plan is ideal for brother & sister.

3. Each life will be underwritten separately.

4. A joint life policy may cover a partner in business under

one policy.

Pankaj want to save tax over and above the deduction allowed under section 80C of the income tax act 1961, which allow deduction from taxable income

4. Interest paid on education loan

In which of the following Bank pays the Interest on the deposit’s fund on monthly /quarterly /half yearly/ yearly basis as chosen by depositor fund:

2. Matching the product with Ramesh‘s financial need.

3. Recommendation of product with highest return.

4. Discourse saving in a purposeful and

need based manner.

4. Customization and tax benefit.

Gaurav bought an endowment plan for 20 year of 10 lac SA with ADB Rider, died in road accident after 10th year how much money claimant would be payable:

1. When a person of the family is involved in double businesses or jobs.

2. When both the life partners are earning

members of the family.

3. When the income of a family is just the double of income of another family.

4. When the members of a family

do not work at all.

3. Professionals & Businessmen

1. Every individual’s income and expenditure pattern is same.

2. Every individual’s income and expenditure pattern is

different.

3. An individual’s income and expenditure has no

relation.

4. An individual should not keep in mind his income

while planning his expenditure.

3. Provide for anticipated changes

4.Surrendering the existing policies for

selling new one

Which one of the following documents distinguishes between Guaranteed and non-guaranteed benefits?

2. Benefit illustration documents

Page 52: Practice Questions (1) (1)

611 1. Income Tax Act 2. Indian Contract Act 3. Insurance Act 1938 4. IRDA Act 1999 3

612 Which one of the following is not a benefit of persistency? 1. Helps the client in achieving goals 2. Reduction in costs 4

613 4

614 Why a building long term relationship with clients is necessary? 3

615 1

616 1. only Sum assured 2.Sum Assured + Bonus 3

617 1. Accidental death benefit (ADB) 2. Critical illness (CI) 3. Hospital Care (HC) 4. Term Rider. 3

618 1. Policy first information report. 2. Advisor confidential report 3. Post Mortem Report. 4.Coroners Report 2

619 1. Married Woman 2. Married Man 3. Married Son 4. Married Daughter 2

620 The face of the life Insurance industry in India is ………..? 1. Life Insurance Council 1

621 1.15 2.12 3.14 4.16 2

622 1. Life Insurance Council 1

Under which one of the following acts the maximum remuneration that can be given to insurance agents described?

3. Increased client satisfaction

4. Decreased revenues

Satish as an insurance advisor while recommending to his client Ramesh is not suitable policies –

1. Satish should check the Ramesh ‘s commitment to the needs

2. Satish should outline the reasons for recommendation

for a particular policy

3. Satish should check the acceptance or rejection of

the recommendation.

4. Should advised him to surrender all the polices which are not buy from

satish.

1. A satisfied client may be the source of other potential clients

2. Reviewing financial needs and plans are necessary

with changes

3. Agent has the option to recommending highest

commission at any time.

4. Introduction of a new insurance

product or a change in a client’s

Circumstance

Pranab is not able to pay premium for continue his policy due to some Financial problem, so he rather than surrendering the policy, what Option he has to convert ……….?

1. In to paid up and reduced Sum Assured would be payable on maturity.

2.Return of Premium on maturity

3. Deduct the underpaid premium from Sum

assured and payable on Maturity

4. Policy was subject to lien.

Ajay has bought an endowment with profit plan for 20 year .if he took a Loan after 5th of commencement of policy and died before 2 year of Maturity .what would be payable on maturity?

3. Sum assured plus vested bonus minus any

outstanding loan/premium & Interest.

4. Paid up value only.

Under what kind of Rider the insurance company pays the treatment cost in the event of hospitalization of the insured, subject to term & Condition of the rider.

Which one of the following report is not considered in case of Pankaj Bought a plan in 2009 & died in road accident in 2011 :

Married Woman’s Property Act 1874 provides that a life insurance Policy that has been taken out by:

2. Life Insurance Corporation

3. Insurance Regulatory Development Authority

4.Insurance Institute of India

How Many offices of Ombudsmen the Government body has set up to Resolving insured customer’s grievances.

For Insurance industry which association to take steps to Develop Education and research in insurance?

2. Life Insurance Corporation

3. Insurance institute of India

4. Insurance Institute of India

Page 53: Practice Questions (1) (1)

623 2. Life Insurance Company 3. Reserve Bank of India 4. SEBI. 1

624 RBI LIC Central Government SEBI

625 Non Disclosure Misrepresentaion Breach of Trust Concealment

626 Lien Counter offer Decline Postpontment

627 Adequate Inadequate too low too high 1

628 1

629

60000 1.5 lac 1.2 lac 3 lac

NA

630 2

631

Sanjeev in a lumsum investment is getting benefit of multiple securities Bonds Fixed Deposit Mutual Fund KVP

3

632

The risk of unemployment is covered with what benefit in the policy Rider Continouation Subsidiary discount

1

633

Paid up option Lien Commutation Loan Facility

4

634

Prospectus of an endowment plan should differentiate in types of benefits Exception & exclusion Maturity & death benefit None of theabove

3

Pankaj being a license insurance advisor has to follow code of Conduct provided by:

1. Insurance Regulatory Development Authority

Which is the body who provides grant to Insurance Regulatory Develompent Authoruty to carry out activites.

While applying for a policy unintentionally Mr.X forgot to disclose that he consumes alcohol,In cotext with Utmost good faith This will be treated as

An underwriter accepts the proposal with certain modified terms and coditions,What it denotes

Ram has set a provision for contigency which can survive for 6 month .This amount is considered as

XYZ client wants to buy a car in future , however his financial planning shows that he cannot afford car as of now .As a financial planner you should

Explain him difference between real need & perceived

Explain him difference between financial & non

financial need

Explain him difference between important &

unimportant need

Explain him difference between short term & long

term need

Premium Income earned by an agent holding a composite license is 600000. What is the max contribution of one organisation

After fact finding , Ram has presented the product to the client in te second meeting . If client approves the recommendation what should be the next xtep

Ask the client to sign the contract of relationship

Check the client's commitment to the need &

continue with processShould take some more time to conclude the sale

Should close the discussion then &

there

Insurer has deducted Rs 3000 from the death claim of Ram. What could be the reason for deduction when all the due premiums were paid

Gauranteed & Non-gauranteed benefits

Page 54: Practice Questions (1) (1)

635 In case of term plan the premium for CI rider shall not exceed

25% 50% 75% 100%

4

636

Loading in a term plan is more likely beacause of Morbidity Mortality Admin expenses

637

Wholelife Endowment Term plan MutualFund

638

License criteria,crimnal offence in the past.given IRDA license.Why? he was less than 21 at that time exception 3

639

In Surgical benfit rider what would be the payout procedure Per day Hospital Cash Benefit RespectivPer day Hospital Cash BenefitWill get lumsum benefit r Irrespective to the su

3

640

Only for Illness For Repairing house Only For Doctors fees Not specified

4

641

Investment Frequency Interest Rate Look in period Taxation

1

642

In case of lien,the risk will classified as per underwriting standards

3

643

which of the following is the final stage of fact finding with the client? Recommending Solutions

4

644

ACR Sarath nominee Insurance company

3

645

Recommend both the plans Refuse to act with client

2

646

Which is suitable life stage to buy Unit linked insurance plan?

2

Investment expenses

The needs of a client were identified,and according to that ,maximum life cover was the first priority,what plan to suggest?

offence had a punishment of less that 2000

atleast 5 yrs hav passed since the sentence

A Critical Illness claim is settled in a policy. The benefits of the policy can be used for

If the client prefers bank fixed deposit rather than cumulative deposit ,due to what implication ?

better than average risk,at the early stage of life

better than the average risk ,at the later stage of the life

Higher than the average risk,at the early stage

Higher than the average risk at the later stage of life

Discuss with proposer about future life prospects and changes Completion of Proposal form

Coming to mutual agreement with objective for Solutions

Sarath is the client and looking for large SA, and the proposal to be certified in the context of confidentiality report with relavent to moral hazard,who is concerned person to do!

Superior of the Sarth's insurance agent

As per agents code of conduct,Agent Recommends protection Plan,but the client insist on investment plan for the financial planning,what an agent should do!

Propose an investment plan and discuss with him regard to discomfort of term plan

Report to the senior and seek his Guidance

Young Married with no children and Single income family

Young Married with no children and Double income family

Young Married with children and Single income family

Young Married with children and Double income family

Page 55: Practice Questions (1) (1)

647

Insurers observe high persistency ratio,then policy reserve increases Reserve decreases Remains constant Surplus decreases

1

648

A loan and interest is outstanding

3

649 4

650

Agent has to comply the code of conduct prescibed by Insurance institue of India IRDA

2

651

25% 50% 75% 100%

4

652

Change of nomination is not allowed in which situation Nominee is minor Policy assigned to insurer

2

653

Age of the insured Type of policy

3

654

In case of nomination, how does the appointee gets its appointment validated Registered with the court Puts in the newspaper

3

655

Maturity benefit is equal to Sum assured plus reversionary bonus minus ? Persistency bonus Outstandin premiums

2

656

If a policy of term 30yrs is imposed with lien, what will be the lien period 5 10 15 20

1

657

Reduced target of agent will have what impact on churning more likely less likely less transparent more transparetn

2

658

Charges Compounding Taxation Premium increase

2

Two policy Matures at the same time for an insurance company,what are the other requirment for maturity with respect to policy.A is absolute assignment and B is conditional assignment.pending requirment in relation with B

A loan amount and oustanding premium is pending

A outstanding premium is pending

A sign on discharge form

If a person have motoring sport as hobby before taking insurance policy,then what it implicates

Moral hazard is Sport and it influence the risk of life

motoring sport is risk and influences moral hazard

motoring sport is risk and influences physical hazard

motoring sport is a physical hazard and it influences risk

National Insurance Academy

Insurance Compliance Dept

If a health rider is taken in a policy, maximum rider premium can be %age of base premium

Assignment is done to 3rd party

In case of assignment, what key factor indicates the requirement of stamp duty

Assignment made in a separate deed

By signing the proposal form

Outstanding premium + interest

In a pension policy if agent says the cost would be 120% of present value if he invests for 10 years, this is due to

Page 56: Practice Questions (1) (1)

659

Do a fact finding again Refuse to proceed Get second opinion

3

660

Underwriter Third party administrator Actuary

2

661

Maturity benefit is equal to Sum assured plus reversionary bonus minus ? Claim within 1st anniversary

662

Change in hospital Special consultant charges Admission to ICU

3

663

Retirement Childhood Pre retirement

4

664

Premium amount and term is mentioned in Preamble Endorsement Terms and conditions Operative clause

4

665 Decline to act for the client 3

666 modified acceptance Counter offer Rectified offer 2

667 If it is acceptable to the complainant 1

668 Insurance addresses the needs of people with risk of living too long by.. Extensive documentation 4

669 While on sales of an Insurance plan Mr…. Had to show his license Due to the category of customer the customer demanded NA 2

After clearly identifying 2 needs from fact finding, client agrees to go for one and gives the reason, what should the agent do now

Proceed with agreed need and document the rejection

In a non life policy, the person who is authorised to process the mediclaim is known as

Claim within 1st calendar year

Claim befor the valuation date

Claim after the valuation date

Under daily hospitalisation cash benefit scheme the amount payable is increased due to what reason

X and Y are married, they are planning for estate planning, which life stage do they belong to

Young married with single income no kids

Nikhil was in the process of closing a unit linked plan sale and the customer put a query which Nikhil does not know. What should Nikhil do?

Direct him to the product booklet

Ask his Supervisor and clarify

Ask the client to put the query in writing

A gave an offer to B and B made changes to the same and returned it to A. It will be called

Rectified Acceptance

If there is no agreement or settlement and the recommendation is also not acceptable to the complainant, in this case the Ombudsman will grant an

award

if it is acceptable to the insurer

if the complainant decides to proceed legally

if the insurer decides to proceed

legally

Restricting the max age at entry

Extensive underwriting at inception

Retirement and pension plans

Due to the profile of the customer

Page 57: Practice Questions (1) (1)

Learning Objective Explanation for correct answer Remark

Actuaries Works on statistical data to arrive on mortality , premium table etc Pg :27

Constituents of Insurance Market NGO spread Awareness as well as In rural on deeper Penetration through Micro Insurance Pg :27

History of Insurance Pg :24

Insurance Industry Pg 24

Insurance Organizations and Roles Reinsurance company is the Insurer for the Insurance Company Pg :26

Micro Insurance Micro Insurance guidelines was issued in 2005 by IRDA . Minimum SA is Rs 5000 & Max is Rs 50,000 Pg :25

Types of Insurance Organization Reinsurance company is the Insurer for the Insurance Company Pg :26

Types of Insurance Organization A re insurance company is the Insurer for Insurance company Pg :26

Agent Pg :201

Agent Pg :202

Agent role & responsibility Pg :202

On recommendation of Mahlotra Committee , Under Joint venture , the foreign player can not have more than 26% stake

Micro Insurance is for Low Income Group . Product ranges from 5K to 50 K .Premium is as low as Rs 15 and can be collected weekly

Agent can receive maximum up to 35% Commission in first year . Maximum commission in ten years horizon cannot be more than 40.%.

different products have different commission . Maximum Commission payable in First Year cannot exceed 35%

Sec 42 of Insurance act 1938 defines licensing procedure for agents .Agents should disclose their commission to the customer on demand and yet not give any rebate

Page 58: Practice Questions (1) (1)

Agents Upfront disclosure Methods Pg:102

Churning & Product switching Repeatedly encouraging clients to switch policies / Investments from one another is called churning Pg :204

Duties & Responsibilities of agents Agent is an intermediary between Insurer and the Client Pg :200

Persist ency Pg 204 : D4

Persist ency Higher Persistency helps Insurer to get Higher revenue thereby increasing profitability Pg :206

Persist ency Higher Persistency helps Insurer to get Higher revenue thereby increasing profitability Pg :206

Claims Pg :219

Claims Pg :221

Claims Pg :219

Claims Pg :219

Valid Claims Suicide clause exclude claim settlements if it happens within One year of the policy commencement Pg :217

Code of conduct Sec 41 (1) of insurance act 1938 prohibits all agents to give rebates Pg :231

As per IRDA regulations , agents are supposed to disclose their COMMISSION when asked by the customer . However Rebates are prohibited

Repeatedly encouraging customers to switch policies or investment from one to another is called Churning

According to IRDA Regulation 2002 , a claim under a life insurance policy will have to be paid or be disputed with giving relevant information within 30 days from the date of receipt of all necessary

documents & clarifications

Sec 107 & 108 of indian evidence act 1872 deals with presumption of death , Waiting period of 7 years is seen in case of person missing

As per IRDA Regulations , when there is a delay by the insurer for settling of a claim , then they need to pay 2% more than the financial years saving account rate of interest

IRDA Guidelines on claim settlement instruct the insurer to complete any additional documents /information collection not in a piece meal basis within 15 days from the time of receiving the claim

intimation

Page 59: Practice Questions (1) (1)

Grievance cells District Court upto 20 L Pg :238

Insurance act 1938 Sec40(1) of Insurance act 1938 prohibits agents from giving rebates Pg 231

IRDA 1999 IRDA 1999 , was passed in parliament establishing it as a corporate Body Pg :233

IRDA Regulations on Advertisement and Disclosures Pg 237

KYC Pg :235

MWPA Beneficiaries under MWPA can be Wife , Children , Wife & Children , Adopted Child Pg :236

Actuaries Pg :249

Agent Licensing Pg :251

Insurance Regulation Bodies Pg :248

Key regulatory Body Pg :249

Power of Central Govt over IRDA Power of Govt to supersede IRDA is unable to discharge its Function or duties Pg :246

Governing Body of Insurance Council Pg :271

IRDA regulations on advertisements include all printed and published materials from Insurer as well as Agents

IAI (Institute of actuaries in India ). Actuary is an expert who applies statistical & mathematical methods to asses risk and calculate premium tables

For License , a person should be Major , Of sound mind , graduate , no criminal records ,attended training , passed III exam

Life Insurance council was constituted under Sec 64 of Insurance ACT 1938. Its the face of Life Insurance Industry

NAI , Pune , was set up by Govt in 1980 with support from LI Council , GI council & 4 psu GI. Main Objective is to design , implement & operate on Insurance Training

Integrated Grievance management system (IGMS) also makes the complaints to be regsitered through E mail – [email protected] or Toll free number 155255

Page 60: Practice Questions (1) (1)

Governing Body of Insurance Council Pg :268

Grievance Redress Cell of IRDA Toll Free Number :155255 & Email Pg:268

Ombudsman Pg :265

Ombudsman Pg:268

Ethics & Code of Conduct Pg :284

Ethics & Code of Conduct The role & responsibility of the agent is important to have a good relation with the customers Pg :279

Peril & Hazard Pg:41

Types of Risk The types of risk that could be insured against are , financial risk , pure Risk & Particular risk Pg :42

Insurable Interest Creditor has Insurable Interest on the Life of Debtor to the extend of the MONEY lent to the debtor Pg :56

Insurance Contracts Pg :53

Utmost Good Faith Pg :57

Assignment Sec 38 of Insurance Act 1938 Defines Assignment and its types Pg:79

Integrated Grievance management system (IGMS) also makes the complaints to be regsitered through E mail – [email protected] or Toll free number 155255

Ombudsman role is to resolve complaints related to claims , disputes with regard to premium / policy, non issue policy documents , all in a cost effective manner

Ombudsman role is to resolve complaints related to claims , disputes with regard to premium / policy, non issue policy documents , all in a cost effective manner

Under IRDA regulations , an agent should carry is license all the time and on demand , should show it to the customers

Peril refers to a specific event which might cause a Loss /Damage .A hazard is a condition that may Increase the chance of perils to happen

Person entering contract should be competent enough . A person is competent when he is a Major ( above 18 years ) , sound mind ,not disqualified

The proposer knows all the material facts about himself and has to disclose all information voluntarily at the time of completing the proposal form and submitting the documents

Page 61: Practice Questions (1) (1)

Insurance Documents Pg :69

Insurance Documents FPR is an Important document which is also an evidence that Risk has begun Pg :70

Insurance Documents The operative clause lays down the Mutual obligation of the parties . Pg :71

Key Documents The proposal form and the proposer's Signature is the basis of the contract . Pg :68

Key Documents Age proof are standard and non standard Pg :69

Key Insurance Documents The proposal form and the signature of the proposer will form the basis of Insurance contract . Pg 68

Key Insurance Documents Pg :72

Key terminologies The person seeking insurance is a Proposer . Proposer & Life assured could be the same or different Pg 66

Lapse Pg :74

Loans & Foreclosure loan is given as a certain %age of Surrender value Pg :79

Nomination An appointee has to be appointed in case the Nominee is a Minor Pg :74

Nomination Pg :78

AGE is a factor for determining the Risk Profile of the Proposer , thus allowing the underwriters to calculate the premium required for the plan

Policy Information statement includes :facility available for frequency and method of premium payment ,contact for service and inquiry related to policy ,Ombudsman location and contact

A grace period normaly is of One month , not more than 30 days for YEARLY , HALF , Qtrly mode of premium payment .

Any number of nominations can be attested on the policy . However No % age of share can be mentioned per nominee

Page 62: Practice Questions (1) (1)

Nomination & Assignments No specific Shares in Multiple Nominations however can be done for successive nominations Pg:78

Paid Up & Lapse Lapsed policy will be made Paid Up and the SA reduced to an amount based on Premiums Paid Pg :75

Paid Up policies Pg :75

Surrender value Pg :76

Human Life Value Pg 95

Premium Calculations Adjustment to take into account of Expenses & profits of the insurer is called loading Pg :100

Primary Underwriter Pg :102

Types of Bonus Persist ency or terminal bonus is given at maturity of the policy Pg :101

Types of Hazards Moral Hazard relates to attitude or Intentions & conduct Pg :91

Underwiting Physical Hazard refers to the physical characteristic of the risk associated with the proposer Pg :91

Underwiting Agents are in direct contact with the Customer and have an important role to play in assessing the risk Pg :102

Underwiting Lien is a clause where the underwriter feels the risk will wear out in time Pg :95

Policy which have A value , ie endowment and having saving component can be made paid up in case it lapses during the term after completion of 3 policy years

Also known as Cash Value . The Option for the policy holder to close the Plan during the Term .due to either Personal Financial problems or policy being mis sold and benefits not up to the clients needs

HLV assumes if the event happens Today how much money one should have in the BANK to get the monthly expenses of the family to continue .

Agent Confidentiality Report is mandatory as It helps the Underwriters to have additional Information about the Proposer as the agent is in better position having met / known the client

Page 63: Practice Questions (1) (1)

Underwriting Pg :95

Underwriting Pg :90

Underwriting Pg :91

Insurance products Term product is the simplest and the cheapest Insurance plan which gives Life cover Pg :112

Insurance Products Pg :117

Micro Insurance Micro Insurance is for Low Income Group . Product ranges from 5K to 50 K Pg:113

Protection Needs Term Insurance will help in protecting the future loss of Income Pg :109 Discuss

Tax & Inflation The Proceeds of Life Insurance are exempted under Sec 10 (10D) Pg :118

Tax & Inflation Pg 118

Tax Implications Under Sec 80 C , the maximum deductible Income from tax in a given year is Rs 1 Lk . Pg :118

Tax Implications The premium should be 20% or less than 20% of the SA to avail the tax benefit of Sec 10 10 d Pg :118

Types of Plans Pg :117

LIENS are clauses which Underwriters apply to the proposal where they feel the RISK will wear off after certain time duration l

Special reports from senior officials or agents are taken by underwriters sometimes if the risk on the policy solicited is high . Informations on Occupation, habits , lifestyle , income would be asked through

this

Under Physical hazard , the Underwriter looks into medical history of the family of the proposer to asses the risk due to heredity

In money back plan , payouts are given at fixed intervals called survival benefits . Usually 25% of SA is paid in equal interval of the term

Under Sec 80 C , the max Amount under Tax deduction through Life Insurance premium will be Rs 1 Lk

Partial Survival Benefits are paid at fixed intervals without any formalities to be completed by the Policyholders

Page 64: Practice Questions (1) (1)

Ulip Ulip offers protection with Investment and flexibilities to manage the Investment to the customers Pg :116

Benefits of Professional Advise A agent is a Professional and gives Need based Solutions Pg :128

Emergency funds Pg: 138

Implication of Interest on saving products Increase in Interest rates will bring the stock price down Pg :137

Income Tax 1961 To avail Sec 80 C of IT 1961 , the FD duration has to be 5 or 10 Years Pg 136

Prioritizing Saving Needs Care should taken that the EMI do not exceed 40% of monthly take home salary Pg :139

Saving Products Investment is made in Lump Sum and the Interest rate is Fixed at the time of Inception Pg 135

Saving Products 1 unit in ETF represents One Gram or Half Gram of Gold Pg :135

Saving Products Three types of deposits :cumulative , recurring & traditional . Rate of interest varies . Pg :133

Saving Products NSC . Kisan Vikas Patra , PPF etc can be brought from Post office Pg 135

Saving Products In cumulative Deposits , Interest is calculated quarterly Pg :113

Tax & Inflation Life Insurance gives 80C Tax Benefit on Premium and 10 10 D on Claims Pg 136

Investment for emergency funds should be invested in saving products that offer easy liquidity and can be converted to Cash without much loss in value

Page 65: Practice Questions (1) (1)

Tax Implications Under Sec 80 C , the maximum deductible Income from tax in a given year is Rs 1 Lk . Pg :136

Types of Saving Products Good returns , Portfolio diversification ,hedging against Inflation are the other reasons for ETF Pg :135

Types of Saving Products Debt instruments caters to Saving and secure income Pg :138

Annuities Pg :155

Annuities Most of the people choose Monthly Mode though Pg:157

Annuities Pg :157

Annuities Pg :156

Annuities One third of the Corpus can be withdrawn on vesting date Tax Free Pg :156

Annuities Commutation allows the Annuitant to withdraw 1/3rd of the corpus amount Tax Free at vesting date Pg :156

Health plans Most Insurer have waiting Period in the health Plans for covering any pre existing illnesses Pg:151

Health plans Pg :151

Health Plans Pg :150

Open market option allows the Annuitant to get the best scenario by taking his/ her annuity from other companies

As epr IRDA regulation post 1st Sept 2010 , The minimum Guaranteed returns in a pension plan has to be 4.5% . The insurer will have to invest very prudently to get this %age return

Open Market Option allows the Annuitant to look at the best Rates in the market from other Insurance companies before taking the pension payouts

No claim bonus is a feature of health plans in which if no claims are made in a policy year , the insurer will give some discount on the next renewal premium

Family members can be covered under One Umbrella . However some Insurance Companies will have specified the number of members one can take under Family floater

Page 66: Practice Questions (1) (1)

Health products Fixed amount is paid on hospitalization on a daily basis Pg :150

Pension Plans Under Sec 10 10 A , Commutation , you can withdraw 1/3rd of the Corpus Tax Free Pg :156

Riders Pg :154

Riders Benefits arising of the Riders cannot exceed the Base Plan SA Pg :155

Riders Pg :155

Tax Implications Pg 157 :B6

Types of Annuity Payment Pension Payout is fixed for certain period guaranteed like 5,10,15,20 and then till Life of the annuitant Pg:156

factors affecting Life stages Public sector makes provision for PPF , health Pg:172

Life stages Protection of Asset is the most factor Pg :170

Life stages Pg :164

Life stages Single Income family , Insurance protection is very important Pg :168

Life stages Pg :170

Lump Sum SA of the rider benefit is paid on diagnosis of the critical illness as per the Rider Feature and subsequent claims under it will not be paid as the rider terminates

According to IRDA regulations Premium of all riders taken together should not exceed 30% of the base policy premium

Under Commutation , person can take 1/3rd of the corpus amount Tax Free at vesting date under Sec 10 10 a

The Income earning capacity keeps going up there by allowing the disposable income to increase as the time goes.

The clinet needs @ Retirement age is Investment to get regular income , estate planning and revisiting the health insurance plans to see their adequacies

Page 67: Practice Questions (1) (1)

Life stages Along with Life cover , child education planning is important stage Pg :168

Life stages of Clients Children normally do not have their own Income source Pg :167

Fact finding The Electronic benefit Illustration gives all information of Returns , Charges Pg:194

Fact Finding fact finding process helps in identifying the clients financial needs, to quantify them & to prioritize them , Pg :184

Fact finding Fact finding as a process is to identify the clients needs , quantify them and prioritize them Pg :184

Financial Planning objective Pg 190

NA NA NA

NA NA NA

NA NA NA

NA NA NA

NA NA NA

NA NA NA

The grading is in 0 -5 rating , O denotes No risk taking ability and 5 denotes High risk taking ability of the client

Page 68: Practice Questions (1) (1)

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