151.

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

A.

Lower profits

B.

Higher profits

C.

Neither lower profits nor higher profits

D.

No effect

152. 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
..
A.

Consumer Forum

B.

COPA

C.

Sebi

D.

Life Insurance Council

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

154.

155.

A.

Nil

B.

1%

C.

5%

D.

10%

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

Good Returns

B.

Regular Income

C.

Safety

D.

Liquidity

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

156. In the sales illustration, the reduction of the actual benefit amount is mainly due to
deduction of
A.

Commission

B.

Charges

C.

Non guaranteed benefits

D.

Reversionary Bonus

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

158.

A.

Insuring existing losses.

B.

Making false insurance claims.

C.

Paying excessively for insurance cover.

D.

Profiting from insurance.

The client of reinsurer are

A.

Insurance companies

B.

Banks

C.

Asset Management Companies

D.

None of the above

159. 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 ?
A.

Endowment

B.

Term

C.

Money Back

D.

Whole of Life

160. 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

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

162.

A.

Insurance broker represent the client and the insurer remunerate the broker

B.

The client represent the broker and the insurer remunerate the broker

C.

Insurer represent both client and broker remuneration

D.

Broker only service the client

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.

D.

A large numbers of policies have lapsed / surrendered resulting in loss of

profit
The company will not declare bonus

163. For annuity plans, before receiving regular/periodic annuity payments, the individual can
make a lump sum withdrawal. This is known as commutation. Up to what proportion of the
accumulated fund can be withdrawn?
A.

The entire fund can be withdrawn

B.

Only half of the fund can be withdrawn

C.

Only one third of the fund can be withdrawn

D.

Only one fourth of the fund can be withdrawn

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

24 hours

B.

1 day

C.

10 days

D.

30 days

165.

For an insurance agent, a low persistency ratio means :

A.

Loss of renewal commission

B.

High client satisfaction

C.

Higher reputation

D.

More earning of First Year Commission

166. 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

167.

168.

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

In the case of life insurance, insurable interest should exist

A.

At the inception of the policy

B.

At the time of a claim

C.

At the time of every renewal premium payment

D.

All the above occasion

In which of the following plan remaining part of the Sum Assured is paid on maturity?
A.

Endowment Plan

B.

Convertible Plan

C.

Money Back plan

D.

Term Plan

169. 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
A.

Endowment plan

B.

ROP plan

C.

Whole life plan

D.
170.

Ulip

Payment/Investments in Kishan Vikas Patra under post office schemes is done

A.

Regularly with no fixed term

B.

Lump Sum with no fixed term

C.

Lump Sum for fixed period of time

D.

Regularly for fixed period of time

171. 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
A.

Less than 10000

B.

More than 10000

C.

Less than 20000

D.

More than 20000

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

173.

A.

5 days from the receipt

B.

10 days from the receipt

C.

15 days from the receipt

D.

20 days from the receipt

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

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

175.

176.

A.

Physical

B.

Moral

C.

Occupation

D.

None of the above

Whose signature is required on attestation of the policy?

A.

Agent

B.

Policy holder

C.

Authorized officials of insurer

D.

Proposer

What is the ceiling of tax exemption under 80 c.

A.

1 lakh

B.

1.5 lakhs

C.

2 lakhs

D.

3 lakhs
----

Section II - Questions and answers

1.

If customer has applied for a policy with 1 Lac SA then what is maximum Premium on which he
can save Taxes
a.

2.

If Ombudsman makes a recommendation and is accepted by Complainant then it would be

a.

3.

Ask open ended questions to arrive at a conclusion

If agent is not aware of answer to a technical question asked by client while presenting a Unit
Linked product to him them what should be the first thing an agent should do
a.

10.

15 days

When agents has made a recommendation to a client and clients rejects that recommendation
by giving reasons then agent should
a.

9.

When Geeta in minor

After receiving Death intimation, in how many days insurer has to tell nominees about the
documentation required
a.

8.

Unit Linked Plan

Seema has made Geeta her nominee, in which circumstances she would be asked to make
appointee?
a.

7.

Convertible term plan

Seema & Ajay are young couple with regular monthly income; they want to save for their 5 year
old daughters education. Considering both of them are generally risk averse, Which plan would
be best suited for them
a.

6.

If Harish owes him money

Rahul is 23 year old professional with no dependent & no liabilities, which would be a plan best
suited for him
a.

5.

Binding on the insurer

Harish is a brother of Rakesh, in which circumstances Rakesh can propose a policy on Harishs
name
a.

4.

Maximum 20000

Refer to the Product Brochure

In which circumstances while discussing a term plan with the client an agent should disclose his

commission scale to the client

a.
11.

Out of charges mentioned below, which should be disclosed to the client while pitching a unit
linked product
a.

12.

All the charges

In which circumstances agent discloses his license to the client

a.

13.

If client asks him to do so

If client asks him to do so

How would the principle of Indemnity effect on Health policies and Term Policies
a. Health policies are contract of indemnity but it does not apply on term policies

14.

NIA is set up to
a. impart training

15.

An offer by an insurer is not accepted unconditionally by the Rakesh rather he puts in a

condition, this offer in return of an offer is known as
a. Counter offer

16.

In which case the appointee in an insurance policy is made

a. When nominee is a minor

17.

Under which circumstances the full SA is not paid on death

a.

18.

Insurance Ombudsman has to pass its award within how many days
a.

19.

Rs. 20,00,000

If a claim is settled by indemnity clause-what does it mean

a.

22.

Rs. 20 lakhs

Consumer dispute redressal forums district level will hear complaints up to the value
a.

21.

3 months

The Ombudsmans powers are restricted to insurance contracts of value not exceeding
a.

20.

Lien

Policy bond Is lost

A couple ,has 2 children and his parents are aged in sixties opt for an family floater health plan,

who are all covered

a.
23.

If RBI increases interest rates of deposit what impact on share market

a.

24.

Sign taken in the benefit illustration.

Arun has taken two endowment policies and both of the policies are in maturing year. But Arun
has opted for conditional assignment in 1st policy & in second policy absolute assignment. What
should the insurer verify at the maturity claim
a.

32.

Real and perceived need

How you can Customer knows the commission payable to Agent?

a.

31.

When it occurs

If the client states that he wishes to purchase an expensive car even though he has limited
resources then on which category the need can be classified.
a.

30.

A void contract is invalid from inception and voidable contract is binding unless
and until one of the parties chooses to set it aside.

For whole life policies, the benefit is paid on death, regardless of

a.

29.

273333

What is the difference between void and voidable contracts?

a.

28.

Decrease in Surrender & lapsation

Calculate Paid Up value Term 30 years. Premium paid for 8 years. SA 8 lacs. Bonus declared
60k.
a.

27.

Self employed are prone to higher risk, public sector get benefits from employer;
self employed are subject to health issues

This year persistency has increased from 82 to 84%. It means

a.

26.

Share market gets volatile, increase in demand of shares, decrease in demand

of shares

Health insurance is needed for self employed other than public sector employee because
a.

25.

Couple, husband only, couples and 2 kids,couples-2kids and parents

no pending dues in the policy

For assignment endorsed in the policy document through separate deed, the insurer should
verify
a.

The deed is properly Stamped

33.

Which one of the following is the most appropriate one?

a.

In case of conditional assignment, the title gets reverted to the assignor on the
happening of the event

Comments: Questions on some topics

1.

Peril & hazard ( based on practical example)

2.

Pooling of risks ( case study)

3.

Utmost good faith. ( case study)

4.

Duty to disclosure

5.

Section 45.( question on 2/3/4/5 years)

6. Age proof( a certificate from panchayat , standard/non standard/ other 2 option with
case study)
7. Information of insurance ombudsman details mention on which section-----endorsements/exclusion/policy information/operative clause.( conclusion to be drawn from
a case study)
8. Question from underwriting---- case study given to find out the adequate designation of a
person.
9.
10.

Benefits of surrender value ( case study given for a sudden unemployed person)
Case study on moral hazard.

11. On death company has given money to nominee after deduction 10 % but no
pending of premium payment and no lien is there. . Loan/ surrender/paid up..( case
study)
12.

Case study on married single income with dependent parent.find suitable product

13. Case study on need of protection & if alive maturity . Find the suitable types of
plan.
14.

Micro insurance maximum cover provided

15. Tax implication , if ULIP policy bought..amount calculating to be found, figure was
given.
16.

Case study on bank cumulative deposit .( monthly, quarterly, yearly, half- yearly)

17. Question from ( g- sects) ----with case study-find out the maturity value in the form of
----principal/ with bonus/ with terminal bonus/ principal with interest
18.

Case study on family floater health insurance plan.

19.

Case study on Quantifying needs.

20.

Case study on real & perceived need.

21.

After fact finding ( with case study) immediate action of agent

22.

Case study on churning ( but not from e book)

23.

Monetary authority of financial system in India..given option.

24.

Minimum age entry for getting license.

25.

Maximum ombudsmans power to insurance contracts--- 20 lakhs.

26.

What is void contract and voidable contract?

27. It is necessary that the premiums should be paid until the court decree in presumption
of death?
28. Insurance broker is represents insurance buyer and remunerated by the insurance
company
29. One took term plan for 20 lakh he wants ADB rider, he is not sure of how much sum
assured need to take in ADB rider. What is your best
suggestion?
30. How you can sure your customer knows the commission payable to you.-by sign got in
the benefit illustration
31.

What is the important objective of the fact finding-identify the client needs.

32.

in which plan weekly premium payments are accepted-micro insurance

33.

in the group insurance which one is the criteria to segment.-similar age group

34. apart from qualification to appointment an agent, which one is the other important
factor to decide to appointment -age
35.

within how many years complaint should be made in consumer protection act-2yrs

Relating to income tax:

1.

If A were purchasing a policy worth 30,000, then how much income tax rebate would he
qualify for?

2.

If A were purchasing policy of 20,000 pr with 3 lacs of insurance cover, then at maturity
what would be the income tax levied?

3.

What is the maximum of premium rebate a person can claim from income tax?

4.

A & B have bought same endowment plan from same insurer, A pays less income tax
than B, why?( in options it was suggested that A is senior citizen)

Relating to Identifying clients needs:

1.

A is young person, just married what kind of insurance plan is recommended?

2.

A is young person with 3 yr kid, what should be the priority-protection cover, investment,
retirement?

3.

A works in private company and B works in PSU. Mediclaim product agent approaches
both but B is not keen on buying, why? ( was suggested that PSUs give medical cover
too)

4.

While giving retirement plan apart from his need, and pocket, what other factors should
be looked upon? ( inflation, cost of living)

5.

A wants to purchase mediclaim for his family consisting wife and 2 kids, what should he
approach for? ( floater was there as option)

6.

When suggesting the final solution to fact finding, what should the agent refer to as his
base for the solution? ( option was clients needs- he derived the solution based on clients
needs)

Relating to chapter 5:
1.

A man wants to buy protection plan for unspecified time period, what should he opt for? (
whole life)

2.

Which plan aims at giving protection? ( term)

Relating to Claims:
1.

A and B have bought same plan from same insurer. Both pay quarterly premium , 22
timesboth surrender their plan post 22nd premiumA pays more surrender charge
than B. why? ( option had that term that A had applied for was greater than B-thats why
the surrender charge was more)

2.

A bought a plan, and dies 2 day before grace period is to expire (premium still not paid).
What would be the claim amount?

3.

An insurer is to pay claim @ 5.2% and delays the claim by 6 months. What should be the
new rate at which it would pay the claimant? ( 2% added to initial- 7.2% was given as
choice)

4.

Question about interim bonus- a mid bonus is given, what would it be calculated upon?

Relating to Indemnity & utmost good faith, Indisputability:

1.

Principle of indemnity what does it work upon?

A.

TROP- Case study

B.

Annuity- Open market option

C.

Ulip- Case study

D.

Money back policy- SA Payment on maturity Tax laws on maturity ( 20% of SA) Income
replacement method Terminal Bonus Moral Hazard Lien Utmost good faith Law of large
numbers Insurable interest Pure risk Fact finding Authentication NIA KVP-Post office
-----