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

2. If a person is concentrating more on health plan and retirement plan then at which stage of life is he in.A. Young unmarriedB. Young marriedC. Young married with KidsD. Pre retirement

3. 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 PlanB. Endowment planC. Return of premium planD. 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.

5. 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 CompanyB. Vishal is older than SandeepC. Sandeep is earning more then VishalD. Vishal is working in a MNC

6. During fact finding, What will be the next step after Identifying clients needA. Quantify clients needB. Priorities Clients NeedC. Recommending ProductD. Fill up the proposal form

7. 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. 213333B. 229333C. 273333D. 293333

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 hazardB. Fraudulent representationC. Moral hazardD. Peril

9. Which of the following falls under voidable contract?A. MisrepresentationB. Lack of insurable interestC. FraudD. None of the above

10. Law of large numbers is worked out by which of the following?A. Pooling of riskB. Maintaining insurable interestC. With utmost good faithD. Randomness

11. 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.

A. Do the fact finding exercise againB. Insist with the client to take a term planC. Give a child plan and revisit the client on a later dateD. Give the lead to another agent

12. If a case is already before the consumer forum, then the ombudsman shouldA. Give a recommendationB. Give a joint decision with the consumer forumC. Dismiss the caseD. 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 risesB. It fallsC. It remains constantD. Gross premiums increases

14. For which of the following reasons, the underwriter should ask beyond agent’s confidential report.A. Physical HazardB. Moral HazardC. SA is too highD. 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 clientB. Suggest an alternative planC. Pass on to the superiorD. 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 claimB. Indisputability clauseC. Redressal procedureD. 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 circumstancesB. Under conditions of the reinsurerC. As directed by actuaryD. 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 healthB. Premium cheque and health declarationC. Only health certificateD. 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 AnnuityB. Open MarketC. 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 advisorB. 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 IndiaB. insurance institute of IndiaC. Charted institute of insuranceD. Insurance institute of risk management

22. In a life insurance policy it is later found that the person doesn’t have insurable interest then the contract is          

A. expiredB. reviewedC. VoidD. 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 hazardB. moral hazardC. non insurable hazardD. 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 monthB. Rs. 24000 per monthC. Rs. 40000 per monthD. 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 perilB. Smoking is a hazard and lung cancer is a perilC. Lung cancer is a peril and smoking is a moral hazardD. 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 differentB. Age of both the candidate are differentC. One has chosen Single premium policy and other has chosen regular premium policyD. 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 rateB. Increase in the range C. Increase in returnD. 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 BackB. Term PlanC. Endowment PlanD. 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 findingB. Consulting the client’s parents C. Consulting the family of the clientD. Reviewing his existing investments

30. Net premium is equal toA. Premium plus interest earningB. Risk premium plus interest earningC. Premium minus interest earningD. Risk premium minus interest earning

31. Pooling of risk in insurance meansA. The premium collected & deposited in a poolB. All similar risks are pooled togetherC. Premium is pool to make claimsD. Contribution of insurance company

32. Principle of utmost good faith will operate in existing policyA. Every time premium is paidB. 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 existA. At inception of policyB. Not neededC. At the time of claimD. Any time during the contract

35. The Premium on all riders put together should not exceed A. 10% of the premium on the base policyB. 20% of the premium on the base policyC. 30% of the premium on the base policyD. 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 clauseC. 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 hospitalizationD. Only surgery expenses are included in daily hospitalization benefit

38. A lump sum withdrawal allowed as commutation in pension plans isA. 1/3rd of the accumulation fundB. 1/4th of the accumulation fundC. 1/2nd of the accumulation fundD. 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 YrsB. annuity will be continued for next 5 YearsC. till he dieD. not remembered

40. In term insurance if Critical illness rider claim happens then what will happen to existing policyA. CI benefit will ceaseB. CI benefit reduced from existing sum assuredC. CI benefit continuesD. 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. MoralB. PhysicalC. OccupationalD. Professional

43. Group Insurance can be taken in following relationship A. employee- employerB. husband-wifeC. family membersD. society members

44. Where one can approach in case of dispute?A. IRDAB. Consumer ForumC. Insurance Institute of IndiaD. Police Station

45. Life insurance is the most important for which age groupA. Young B. Pre- retirementC. RetirementD. children

46. Family floater health Insurance plan coversA. All members of a FamilyB. Husband and Wife onlyC. Parents onlyD. Children Only

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

A. 30 daysB. 90 daysC. 120 daysD. 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 paidC. 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 theA. First five years of policyB. First Two years of policy C. ClaimD. Inception of the policy

50. The Ombudsman’s powers are restricted to insurance contracts of value not exceeding?A. 50 lakhsB. 30 lakhsC. 25 lakhsD. 20 lakhs

51. The premium for accidental death benefit rider must not exceedA. 15% of base policy premiumB. 25% of base policy premiumC. 30% of base policy premiumD. 40% of base policy premium

52. What amount of insurable interest does an individual have in his own life?A. 20,000B. 50,000C. Up to the sum assured taken in the planD. Unlimited

53. Ombudsman passes an award within which timeA. 1 monthB. 2 monthsC. 3 monthsD. 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. 2013B. 2015C. 2017D. 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. SwitchingB. Doing a financial planningC. ChurningD. Wrong selling

56. If bonus is given under a plan the additional premium added is known asA. LoadingB. InvestmentC. Frequency

57. Certificate from the village panchayat A. Will be considered as standard age proofB. Will be considered as non standard age proofC. Will not be accepted

58. What is the maximum sum assured under a micro insuranceA. 10000B. 25000C. 50000D. 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. ActuaryB. UnderwriterC. Claim DepartmentD. 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 lacsB. 3 lacsC. 5 lacsD. 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 planB. Endowment planC. Whole life planD. Money back plan.

62. Harsh’s 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. VoidableB. InvalidC. ValidD. Null & voidable

67. If a contract is signed by a 15 years old boy, this contract will beA. Null and voidB. InvalidC. VoidableD. Valid

68. If a life insurance policy is issued with a lien, it will be mention inA. ProvisoB. ScheduleC. Terms & conditionsD. Endorsement

69. Available Loan amount under a life Insurance policy is generally based onA. Total paid premiumB. Sum AssuredC. Surrender valueD. Paid up value

70. De- tarrification is a process by which pricing of InsuranceA. RisesB. DecreasesC. Reaches at a level as per industry trendsD. Insurance can price their product on their self past experiences.

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

A. Some Specific InsurerB. Those Insurer who did not created Insurance Ombudsman SystemC. All insurerD. It is optional

72. Which body has created a call center for logging a complaintA. Life Insurance CouncilB. IRDAC. Insurance Association

D. Insurance Institute of India

73. What is the key function of NIAA. Provide suggestion for Premium calculationB. To be an active link between Global market & Indian Life Insurance IndustryC. Design, implement and operate an insurance trainingD. 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 fundB. He has opted for Settlement optionC. 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 yearsB. 5 yearsC. 7 yearsD. 2 years

76. Incase of presumption of deathA. Not necessary to pay premium until court decreeB. Necessary to pay premium until court decreeC. Claim not admissible

77. What will be lien amount in 3rd year as compared to the 4th year of lien.A. It is higherB. DecreaseC. Slightly higherD. Slightly lower

78. In which plan weekly premium payments are accepted.A. Health InsuranceB. Group InsuranceC. 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. 2011B. 2012C. 2013D. 2014

80. Insurance companies are required to honor the awards passed by the Insurance Ombudsman within how many days

A. 10 daysB. 15 daysC. 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 doesn’t 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 underA. Life and non life respectivelyB. Both life insuranceC. Both non life insuranceD. 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. ProvisioB. EndorsementsC. Operative clauseD. Terms and Conditions

85. In a pension plan illustration what are the parts which shows the benefit for an annuitant.A. Insurance coverageB. Annuity partC. Guaranteed and non guaranteed partD. Vesting age

86. If the employer has insurable interest in the life of an employee, what kind of policy is this?A. Surety insuranceB. Keyman InsuranceC. Partnership InsuranceD. 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 companiesB. BanksC. 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 lifestyleB. EmployeesC. Age of the groupD. Medical history of group

90. A low persistency ratio for the insurance company means that:A. The customers are satisfied with the productsB. The company is acquiring more business and new customers

C. A large numbers of policies have lapsed / surrendered resulting in loss of profitD. 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 documentB. 20 days from the date of receipt of the policy documentC. 25 days from the date of receipt of the policy documentD. 30 days from the date of receipt of the policy document

92. Law of Large number helps the insures toA. Calculate the premiumB. Increase the profitabilityC. Ascertain the death ratioD. Declare the bonus

93. A person with a criminal background due to Financial fraud would come under which hazardA. Physical B. MoralC. 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 20000B. Maximum 100000C. Maximum 120000D. Maximum 150000

95. If Ombudsman makes a recommendation and is accepted by Complainant then it would beA. Binding on the insurerB. Binding on Court Of LawC. Binding on IRDAD. Binding of Insured

96. From Insurance Company’s point of view, most important aspect in a Term Insurance Policy lies with –A. Good ethicsB. Fact findings C. The proposalD. 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. AgentB. Chief Actuary C. Under writerD. 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 company’s 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 manC. 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 & perilB. Peril & hazardC. Effect & causeD. 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 fundingB. Health insuranceC. Housing Loan insuranceD. Retirement benefit insurance