IC 33 Questions 1. How are perils and hazards normally distinguished under term insurance policies? A.

Perils are medical factors which influence the risk of dying and hazards are lifestyle activities which influence the risk of dying. B. Perils are risks that policyholders will die before a specified date and hazards are factors which could influence that risk. C. Perils are factors which affect the risk being insured and hazards are the size of the risk being insured. D. Perils are factors which could influence an insured event occurring and hazards are the actual events which will trigger a payout If a person is concentrating more on health plan and retirement plan then at which stage of life is he in. A. Young unmarried B. Young married C. Young married with Kids D. Pre retirement 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. Term Insurance Plan B. Endowment plan C. Return of premium plan D. Pension plan 4. An indemnity bond was signed in a policy when the claim was paid. This indicates that the policy was. A. It was lost. B. It was paid up. C. It was lapsed. D. It was surrendered. 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? A. Sandeep has taken another policy from XYZ Life Insurance Company B. Vishal is older than Sandeep C. Sandeep is earning more then Vishal D. Vishal is working in a MNC During fact finding, What will be the next step after Identifying clients need A. Quantify clients need B. Priorities Clients Need C. Recommending Product D. Fill up the proposal form 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? A. 213333 B. 229333 C. 273333 D. 293333

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8. 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 A. Physical hazard B. Fraudulent representation C. Moral hazard D. Peril 9. Which of the following falls under voidable contract? A. Misrepresentation B. Lack of insurable interest C. Fraud D. None of the above

10. Law of large numbers is worked out by which of the following? A. Pooling of risk B. Maintaining insurable interest C. With utmost good faith D. Randomness 11. During a fact finding process the need analyzed were income replacement and childrens 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. A. Do the fact finding exercise again B. Insist with the client to take a term plan C. Give a child plan and revisit the client on a later date D. Give the lead to another agent 12. If a case is already before the consumer forum, then the ombudsman should A. Give a recommendation B. Give a joint decision with the consumer forum C. Dismiss the case D. Give an award. 13. If the sum assured remains the same, what will be impact of net premium if the age of the policyholder increases A. It rises B. It falls C. It remains constant D. Gross premiums increases 14. For which of the following reasons, the underwriter should ask beyond agents confidential report. A. Physical Hazard B. Moral Hazard C. SA is too high D. Pure Risk 15. 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 ? A. Enquire about the refusal from the client B. Suggest an alternative plan

C. Pass on to the superior D. Pass on to the other agent 16. 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 A. Fraudulent claim B. Indisputability clause C. Redressal procedure D. Pending decision from Ombudsman 17. 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? A. Under no circumstances B. Under conditions of the reinsurer C. As directed by actuary D. As per company policy 18. 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? A. Reinstatement Fee and Proof of continuing good health B. Premium cheque and health declaration C. Only health certificate D. Premium cheque with arrears 19. If the customer has invested money in a pension plan from company A and buys an annuity from company B, what is the nature of transaction? A. Life Long Annuity B. Open Market C. Reinsuring Annuity 20. If a policy holder buys a policy from the advisor and lodges a complaint, it should be treated as : A. Same for all policies sold by advisor B. Same for all policies sold by the advisor except corporate clients 21. In life insurance business if a person is working in calculating premium rates of insurance products, then he is mostly likely a member of A. institutes of actuaries of India B. insurance institute of India C. Charted institute of insurance D. Insurance institute of risk management 22. In a life insurance policy it is later found that the person doesnt have insurable interest then the contract is A. expired B. reviewed C. Void D. Valid 23. If both parents of proposer died in their thirties due to heart attack what is the kind of peril or hazard the proposer has? A. Insurable hazard B. moral hazard C. non insurable hazard D. Physical hazard

24. Raunak earns 80,000 per month as salary. He has taken a House loan of Rs. 500000. What will be the maximum amount of EMI that can be charged by the Bank to recover the loan amount? A. Rs. 32000 per month B. Rs. 24000 per month C. Rs. 40000 per month D. Rs. 48000 per month [Chapter 6/13 - Care should be taken to ensure that EMIs do not exceed 40% of the monthly take home salary.] 25. According to insurance terminology which of the following is correct? A. Lung cancer is a hazard whereas smoking is a peril B. Smoking is a hazard and lung cancer is a peril C. Lung cancer is a peril and smoking is a moral hazard D. Smoking is a moral hazard whereas lung cancer is a peril. [Chapter 2/5 - If lung cancer is a peril then smoking can be a hazard that may increase the chance that the peril (lung cancer) will occur.] 26. 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? A. Risk profile of both the policyholder are different B. Age of both the candidate are different C. One has chosen Single premium policy and other has chosen regular premium policy D. Both have chosen different kind of policies. 27. Open market option under Annuity policy would extend which of the following benefit? A. Ensure Better annuity rate B. Increase in the range C. Increase in return D. Switch of Funds 28. 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? A. Money Back B. Term Plan C. Endowment Plan D. ULIP 29. What should an agent do in order to understand the mental state of client in respect to his investments in saving products A. Fact finding B. Consulting the clients parents C. Consulting the family of the client D. Reviewing his existing investments

30. Net premium is equal to A. B. C. D. Premium plus interest earning Risk premium plus interest earning Premium minus interest earning Risk premium minus interest earning

31. Pooling of risk in insurance means A. The premium collected & deposited in a pool B. All similar risks are pooled together C. Premium is pool to make claims D. Contribution of insurance company 32. Principle of utmost good faith will operate in existing policy A. Every time premium is paid B. If the policy has lapsed and it has to be revived. C. If the insured person falls sick and is admitted to hospital. D. If the insured person changes his job. 33. Both the parties to a contract must agree and understand the same thing and in the same sense which is called A. Consideration. B. Legality of an object. C. Consensus ad idem. D. Acceptance. 34. In case of life insurance, Insurable interest must exist A. At inception of policy B. Not needed C. At the time of claim D. Any time during the contract 35. The Premium on all riders put together should not exceed A. 10% of the premium on the base policy B. 20% of the premium on the base policy C. 30% of the premium on the base policy D. 40% of the premium on the base policy 36. How riders will help the customer in life insurance? A. allows policyholders to customize their insurance cover with additional benefits B. rider is like a clause C. Operative clause. D. Rider is like Preamble. 37. In Daily hospitalization cash benefit scheme, A. The daily amount paid is fixed and will never be more or less than the cost of actual treatment. B. The insurance company may pay an additional amount on a daily basis if the insured is admitted to the Intensive Care Unit (ICU). C. The insurance company will pay for doctor consultation fees incurred prior to hospitalization D. Only surgery expenses are included in daily hospitalization benefit 38. A lump sum withdrawal allowed as commutation in pension plans is A. 1/3rd of the accumulation fund B. 1/4th of the accumulation fund C. 1/2nd of the accumulation fund

D. Full withdrawal is allowed 39. 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? A. paid up to 75 Yrs B. annuity will be continued for next 5 Years C. till he die D. not remembered 40. In term insurance if Critical illness rider claim happens then what will happen to existing policy A. CI benefit will cease B. CI benefit reduced from existing sum assured C. CI benefit continues D. No change in policy. 41. What is the main objective of taking the life insurance policy? A. Tax benefit B. Savings C. Investment D. Protection 42. If person consumes alcohol- what is the type of hazard? A. Moral B. Physical C. Occupational D. Professional 43. Group Insurance can be taken in following relationship A. employee- employer B. husband-wife C. family members D. society members 44. Where one can approach in case of dispute? A. IRDA B. Consumer Forum C. Insurance Institute of India D. Police Station 45. Life insurance is the most important for which age group A. Young B. Pre- retirement C. Retirement D. children 46. Family floater health Insurance plan covers A. All members of a Family B. Husband and Wife only C. Parents only D. Children Only 47. According to IRDA guidelines, how long does an insurance company have to complete its investigation of a claim? A. 30 days B. 90 days C. 120 days

D. 180 days 48. How the Daily hospitalization cash benefit will provide benefits to policyholder who is hospitalized? A. Entire charges are refunded. B. Entire charges less bed charges will be paid C. A fixed amount on a daily basis is paid irrespective of the actual cost of treatment D. Only Hospital bill will be paid 49. Indisputability clause can be enforced by the insurance company during the A. First five years of policy B. First Two years of policy C. Claim D. Inception of the policy 50. The Ombudsmans powers are restricted to insurance contracts of value not exceeding? A. 50 lakhs B. 30 lakhs C. 25 lakhs D. 20 lakhs 51. The premium for accidental death benefit rider must not exceed A. 15% of base policy premium B. 25% of base policy premium C. 30% of base policy premium D. 40% of base policy premium 52. What amount of insurable interest does an individual have in his own life? A. 20,000 B. 50,000 C. Up to the sum assured taken in the plan D. Unlimited 53. Ombudsman passes an award within which time A. 1 month B. 2 months C. 3 months D. 6 months 54. 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. A. 2013 B. 2015

C. 2017 D. 2020 55. 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 A. Switching B. Doing a financial planning C. Churning D. Wrong selling

56. If bonus is given under a plan the additional premium added is known as A. Loading B. Investment C. Frequency

57. Certificate from the village panchayat A. Will be considered as standard age proof B. Will be considered as non standard age proof C. Will not be accepted 58. What is the maximum sum assured under a micro insurance A. 10000 B. 25000 C. 50000 D. 100000 59. 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? A. Actuary B. Underwriter C. Claim Department

D. Accounts

60. If Naresh wishes to take the tax benefit of the full premium paid which is 60000, what amount of sum assured should he avail in a ULIP plan. A. 2 lacs B. 3 lacs C. 5 lacs D. 6 lacs

61. Ashish is looking at different plans of insurance for protection at the lowest premium. Which is the best plan for him? A. Term plan B. Endowment plan C. Whole life plan D. Money back plan. 62. Harshs policy matured, however he was paid only 25% of the sum insured in spite of all his premiums been paid on time. This indicates that his policy is a A. Term plan. B. Endowment plan. C. Money back plan. D. Wholelife plan. 63. In the personal statement, Ramesh declares that he consumes alcohol twice every week. This is a A. Moral hazard. B. Moral peril. C. Physical hazard. D. Physical peril.

64. Micro insurance is made specifically for people from. A. High income. B. Middle class. C. Low income. D. Affluent class. 65. The reduction in the benefit illustration shows what. A. Charges. B. Mortality. C. Interest. D. Inflation. 66. If Insurable interest does not exists at the time of inception of the life insurance policy then, life insurance contract is A. Voidable B. Invalid

C. Valid D. Null & voidable 67. If a contract is signed by a 15 years old boy, this contract will be A. Null and void B. Invalid C. Voidable D. Valid 68. If a life insurance policy is issued with a lien, it will be mention in A. Proviso B. Schedule C. Terms & conditions D. Endorsement 69. Available Loan amount under a life Insurance policy is generally based on A. Total paid premium B. Sum Assured C. Surrender value D. Paid up value 70. De- tarrification is a process by which pricing of Insurance A. Rises B. Decreases C. Reaches at a level as per industry trends D. Insurance can price their product on their self past experiences. 71. As per Regulation for protection of Policyholders interest 2002 (IRDA), Which insurer will have a grievance redressal System A. Some Specific Insurer B. Those Insurer who did not created Insurance Ombudsman System C. All insurer D. It is optional 72. Which body has created a call center for logging a complaint A. Life Insurance Council B. IRDA C. Insurance Association D. Insurance Institute of India 73. What is the key function of NIA A. Provide suggestion for Premium calculation B. To be an active link between Global market & Indian Life Insurance Industry C. Design, implement and operate an insurance training D. Regulate the investment of funds by Life Insurance company 74. 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 A. He has switched his fund B. He has opted for Settlement option C. He has he has redirected his past premium. D. Policy was lapsed on the time of maturity 75. For tax Saving Someone wants to fixed deposit in bank. What duration is required for it? A. 3 years

B. 5 years C. 7 years D. 2 years 76. Incase of presumption of death A. Not necessary to pay premium until court decree B. Necessary to pay premium until court decree C. Claim not admissible

77. What will be lien amount in 3rd year as compared to the 4th year of lien.
A. B. C. D. It is higher Decrease Slightly higher Slightly lower

78. In which plan weekly premium payments are accepted. A. Health Insurance B. Group Insurance C. Micro Insurance 79. 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 A. 2011 B. 2012 C. 2013 D. 2014 80. Insurance companies are required to honor the awards passed by the Insurance Ombudsman within how many days A. 10 days B. 15 days C. 20 days D. 25 days 81. If IRDA is unable to discharge its functions or duties, Central Government A. Has the power to supersede the IRDA by issuing notification. B. Has the power to supersede the IRDA by issuing a bill in parliament C. Has the power to supersede the IRDA by issuing draft D. Can make changes in IRDA law 82. Health insurance policy holder takes treatment in a hospital which doesnt have cashless facility. How the policy holder will get benefited A. Need to spend and Get claim from the insurer B. Need to add that hospital as TPA C. Need not to claim D. Need to switch to the another insurer 83. Health insurance rider and critical illness rider in classified under A. Life and non life respectively A. Both life insurance B. Both non life insurance C. Nonlife and life respectively. 84. 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?

A. B. C. D.

Provisio Endorsements Operative clause Terms and Conditions

85. In a pension plan illustration what are the parts which shows the benefit for an annuitant. A. Insurance coverage B. Annuity part C. Guaranteed and non guaranteed part D. Vesting age 86. 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 87. The concept of indemnity is based on the key principle that policyholders should be prevented from A. Insuring existing losses. B. Making false insurance claims. C. Paying excessively for insurance cover. D. Profiting from insurance. 88. The client of reinsurer are A. Insurance companies B. Banks C. Asset Management Companies 89. For assessing the risk of a group health insurance policy, which of the following information is the most critical A. Group lifestyle B. Employees C. Age of the group D. Medical history of group 90. A low persistency ratio for the insurance company means that: A. The customers are satisfied with the products B. The company is acquiring more business and new customers C. A large numbers of policies have lapsed / surrendered resulting in loss of profit D. The company will not declare bonus

91. 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 A. 15 days from the date of receipt of the policy document B. 20 days from the date of receipt of the policy document C. 25 days from the date of receipt of the policy document D. 30 days from the date of receipt of the policy document 92. Law of Large number helps the insures to A. Calculate the premium B. Increase the profitability C. Ascertain the death ratio D. Declare the bonus

93. A person with a criminal background due to Financial fraud would come under which hazard A. Physical B. Moral C. Occupation 94. If customer has applied for a policy with 1 Lac SA then what is maximum Premium on which he can save Taxes A. Maximum 20000 B. Maximum 100000 C. Maximum 120000 D. Maximum 150000 95. If Ombudsman makes a recommendation and is accepted by Complainant then it would be A. Binding on the insurer B. Binding on Court Of Law C. Binding on IRDA D. Binding of Insured 96. From Insurance Companys point of view, most important aspect in a Term Insurance Policy lies with A. Good ethics B. Fact findings C. The proposal D. Underwriting process 97. Mr. Purusottam has joined as Director of Insurance Company. Now as per the IRDA act he is not allowed to play the role of which of the following: A. Agent B. Chief Actuary C. Under writer D. None of these 98. ABC Insurance Company has appointed many agents. They are helping in underwriting process to the underwriters. However, Mr. Vimal, an agent has done adverse selections. From insurance companys point of view, which among the following is most likely considered to be the adverse selection? A. Obtaining a policy from a very poor person B. Obtaining policy from a rich man C. Vimal has obtained most of his policies from railway porters D. In certain cases material facts are changed to obtain higher claims

99. The lung cancer is aggravated by smoking. In terms of insurance, these are respectively known as A. Hazard & peril B. Peril & hazard C. Effect & cause D. Either peril or hazard

100.

Ashok is a young married man with beautiful young wife and two kids. He should select which types of insurance projects? A. Contingency funding B. Health insurance C. Housing Loan insurance D. Retirement benefit insurance