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Examination In
Investment-Linked
Life Insurance
(CEILLI)
Tutorial
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Certificate Examination In
Investment-Linked Life Insurance
(CEILLI) TUTORIAL
No Side Talking
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Switch Off/Silent
Handphone
Proper Attire
No Smoking
Maintain
Cleanliness
Course Objectives
This course will help participants to :
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TMTDA/ADA/CEILLI/PPT/Eng/August2015
Chapter 1
INTRODUCTION TO
INVESTMENT-LINKED
LIFE INSURANCE
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Introduction to Investment-Linked
Life Insurance
The Life Insurance Association of Malaysias (LIAM) report
Total number of InvestmentLinked insurance grew between
2012 and 2013.
48.4%
(2012)
55.2%
(2013)
Introduction to Investment-Linked
Life Insurance
Investment-Linked policy owners can choose :1. Amount of coverage needed
With selected annual premium
Introduction to Investment-Linked
Life Insurance
Investment
Policyholder
Pay
premium
to
purchase
fund
Protection
Death
TPD
Fund
managed
by Insurer
Value of
Policy
linked
Directly
linked
Special
Unitised
Fund
Investment
Performance
Depends
On
(Everyday
fluctuations
of market
forces)
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Introduction to Investment-Linked
Life Insurance
Investment-linked insurance offers investors policies
where:
Premiums are used to purchase funds
Value of policy linked to units in a special unitised fund
Value of units directly reflect the value of the underlying fund
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Introduction to Investment-Linked
Life Insurance
RM 5,000 for
5,000 units
(RM1/unit)
After 2 years
RM3/unit
RM0/unit
5,000 units x
RM3/unit =
RM 15,000
Lose all
premiums paid
and coverage
provided
Introduction to Investment-Linked
Life Insurance
Malaysia/Singapore
Singapore
Malaysia/
InvestmentLinked
UK
UK
U.S.A.
U.S.A.
Unit-Linked
Variable Life
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Sample Questions
1.
What are the factors that have contributed to the steady growth
of the life insurance industry in Malaysia since 2000?
I.
A.
B.
C.
D.
I and II
II and III
III and IV
II
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Sample Questions
2. Which of the following is the correct description of an
investment-linked life policy?
A.A participating policy offering lifetime coverage
B.A capital guaranteed policy
C.An endowment policy which provides minimum
returns
D.A policy offering protection while also investing in
funds which form the basis for returns to the policy
owner
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Sample Questions
3. An investment-linked life insurance policy is also
known as the following in some parts of the world:
I.
II.
III.
IV.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
4.
A.
B.
C.
D.
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Sample Questions
5.
I
I and II
III
IV
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6.
I.
II.
III.
IV.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
18
Chapter 2
Mechanisms and
Features of Regular
Premium InvestmentLinked Life Insurance
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Allocated:
For Investments
Insurance
Premiums
Unallocated:
For Insurer
Less insurance
charges, policy
fee and fund
management fee
Less agents
commissions and
management
expenses
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SAM Factor
1 to 16
60
17 to 25
55
26 to 35
50
36 to 45
35
46 to 55
25
56 and above
15
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or
o Free for only a limited number of switches for a
period of time
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Condition?
1. Regular premium has been paid without fail
2. No premium holiday has been affected
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Prices
Prices
, units acquired at lower prices will appreciate
in value.
Means leveraging
price fluctuations.
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4)Taxable
income
2013 =
Rm50k
Mr. A
2) Active
unit trust
agent
3)No EPF,
no life
insurance
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Taxable
income
2013 =
Rm50k
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Sample Questions
1. Which options are open to policy owners of a
regular premium investment-linked plan?
I.
A policy owner may opt for higher a sum assured than the
minimum amount stipulated by the Sum Assured Multiple rule.
II. A policy owner can pay top-up premium to accelerate the
accumulation of the account value in the policy.
III. A prospective policy owner can apply to combine a single
premium plan with a regular premium plan into one policy.
IV. A prospective policy owner can select the death benefit based
on either the sum assured or the account value, whichever is
higher.
A.
B.
C.
D.
I and II
I, II and III
II and III
I, III and IV
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Sample Questions
2. Which of the following statements are correct?
I.
A.
B.
C.
D.
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Sample Questions
3. A female, aged 30 years, has budgeted to set aside
RM3,000 a year for a basic regular premium
investment-linked plan with a Unit-Deducting
Hospitalization Rider. According to the SAM formula, the
multiple factor for her age is 50 times. How would you
calculate the minimum sum assured for the basic plan?
A.RM3,000 minus the notional premium for the rider, multiply by 50.
B.RM3,000 multiply by 50.
C.RM3,000 multiply by 55 times.
D.RM3,000 minus the notional premium, then multiply by 55 times.
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Sample Questions
4.
III.
IV.
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C.
D.
I, III and IV
II, III and IV
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Sample Questions
5. Identify the correct statements from those given below.
I.
II.
III.
IV.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
6. Select the correct statements from the following.
I.
II.
III.
IV.
I, II and IV
I, II and III
I and III
II and IV
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Chapter 3
Mechanisms and
Features of Single
Premium InvestmentLinked Life Insurance
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COI deduction cover the shortfall between account value and SA.
Shortfall difference = Sum at Risk (SAR)
Account value increases, COI reduces. If account value exceed
basic SA, COI cease. If account value drops again below BSA,
COI deduction resume.
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Sample Questions
1. Single premium investment-linked insurance is said to be more
inclined towards investment than protection because
A. generally, about 95% of the single premium is allocated for
investment in fund units.
B. the policy owner has the discretion to opt out of any
protection coverage so that no cost of insurance will be
deducted from the account value.
C. the usual sum assured is 25 per cent above the single premium
outlay and may be lowered to 5 per cent above the premium
for older age groups, i.e. RM125,000 for SP of RM100,000,
RM105,000 for senior ages with the same premium.
D. once the account value exceeds the basic sum assured, the
death benefit will be the account value, not inclusive of the
sum assured.
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Sample Questions
2. Mrs. A, aged 45, signs up for a single premium investment-
A. RM250,000.
B. RM125,000.
C. RM205,000.
D. RM210,000
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Sample Questions
3. Which of the statements below are correct regarding single
I, III and IV
I and III
II and IV
II, III and IV
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Sample Questions
4. Which statement/s relate(s) to the application of cost of insurance
(COI) in single premium investment-linked insurance?
I.
I
III
II and III
IV
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Sample Questions
5. Top-ups for single premium investment-linked plans are
encouraged when
I.
II.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
6. The few mechanisms and features of single premium investment-linked
plans which differ from regular premium investment-linked plans are:
I.
II.
III.
IV.
The sum assured formula for single premium plans is different than
that for regular premium plans.
The death benefit formula for single premium plans is not guided by
the same minimum Sum Assured Multiple rule applicable to regular
premium plans.
The allocated premium ratio for single premium plans is different
from that for regular premium plans.
While the policy is kept in force, the cost of insurance deductions
for single premium plans may not be continuous because the
formula is based on sum at risk, unlike regular premium plans which
are based on sum assured.
A.
B.
C.
D.
I and IV
I, II, III and IV
II, III and IV
I, III and IV
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Chapter 4
CONSIDERATIONS FOR
PURCHASING AN
INVESTMENT-LINKED
POLICY
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Transparency
Expertise
Benefits
Access
Pooling/
Diversification
Administration
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Flexibility
Single premium
top-ups
Withdrawals
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Descriptions of
benefits and
excluded risk
Statement of
Cost Of
Insurance (COI)
Statement of
Premium
Holiday (PH)
Statement of
Investment
returns
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Short
descriptions
Policy
Disclosure
Sheet (PDS)
Requirement
for intended
policy owner
to sign
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2) Charges
The administration fee, insurance charge, fund management
fee are usually not guaranteed.
Subject to regular review and can be changed by giving a
written notice over a specific period e.g. 3 months
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Regular Premium
Investment-Linked Plan
Investment instruments by
insurer
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Regular Premium
Investment-Linked Plan
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Regular Premium
Investment-Linked Plan
12 Tax relief
Tax relief
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Sample Questions
1. The benefits of an Investment-Linked policy are:
I.
I and II.
II and IV.
I and III.
I, II, III and IV.
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Sample Questions
2. When an investment-linked policy reaches maturity,
the maturity value will be
A.
B.
C.
D.
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Sample Questions
3.
What are two similarities between a regular premium investmentlinked plan and a whole life participating plan?
I.
II.
III.
IV.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
4.
II.
III.
IV.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
5.
A.
I, II, III and IV.
B.
I, II, and III.
C.
I, III and IV.
D.
I and III.
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Sample Questions
6.
II.
III.
IV.
A.
B.
C.
D.
I and III.
II, III, and IV.
I, III and IV.
II and III.
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Chapter 5
INVESTMENT
CONSIDERATIONS
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Investment Considerations
Introduction
1. There is an increasing need for sound and proper
advice on how, what, when, where and why
investments must be done.
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Investment Considerations
1. Investment Objectives
2. Availability of Funds
3. Risk or Security
4. Investment Horizon
5. Accessibility of Funds
6. Taxation Treatment
7. Investment Performance
8. Diversification
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Investment Considerations
1. Investment Objectives
Fundamental Investment Objectives
Safety
- Returns
conservative
- Try its best to
create a hedge
against inflation
Growth
To hold the
stocks for a long
time to derive
profits from the
growth of the
investments.
Income
To see a steady
stream of income
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Investment Considerations
1. Investment Objectives
Other Investment Objectives
Comfortable standard of living
Funds for dependents
Funds for death
Income in retirement
Improvement in financial position
Funds for children education
Hedging inflation
Liability cancellation
Achieving Financial Freedom
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Investment Considerations
2. Availability of Funds
Clients have to do analysis to make sure that they:
1. Have enough money to put aside for investment.
2.Will be able to follow through with the
investments.
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Investment Considerations
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Investment Considerations
2. Availability of Funds
There are two types of fund analysis :
a. Simple Monthly
Cash Flow
Analysis
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Investment Considerations
2. Availability of Funds
a) Simple Monthly Cash Flow Analysis
No
Income
1. Salary
RM
Expenditure
3,000.00 Housing Loan Payments
2.
3.
Rental
Commissions
4.
5.
Others
6.
7.
8.
Misc.
TOTAL
7,500.00
TMTDA/ADA/CEILLI/PPT/Eng/August2015
RM
1,000.00
750.00
500.00
250.00
2,000.00
500.00
500.00
1,000.00
6,500.00
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Investment Considerations
2. Availability of Funds
b) Simple Net-Worth Analysis
No
Assets
1.
House
2.
3.
Car
EPF
Savings
Account
Insurance
Cash Value
4.
5.
TOTAL
RM
Liabilities
220,000.00 Housing Loan Balance
RM
200,000.00
35,000.00
5,500.00
10,000.00
20,000.00 Others
291,500.00
15,000.00
265,500.00
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Investment Considerations
3. Risk or Security
Risk/ Return Trade-off
Returns are directly proportional to the risk in investment.
Risk
Return
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Investment Considerations
3. Risk or Security
The difference between high risk and low risk:
Risk
High risk/
aggressive
Low risk/
conservative
Description
A mutual fund or stock can potentially
achieve higher returns because of
greater volatility.
A mutual fund or stock will trade close
to its historical average prices and will
tend to be quite stable.
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Investment Considerations
3. Risk or Security
Know your Investment risk profile (e.g. age, family
situation, experience ) to determine how best to allocate
your savings amongst various risk asset.
Risk Averting
(Conservative)
Risk Indifferent
(Neutral)
Risk Taking/Seeking
(Aggressive)
MODERATE RISK
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Investment Considerations
3. Risk or Security
What is the concept of risk in investment?
1.Is the Volatility or how widely the price of a stock or
mutual fund fluctuates.
2.
Fluctuations
Risk, because you stand to make
and also lose more money, compared to a fund that doesnt
fluctuate as wildly.
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Investment Considerations
4. Investment Horizon
1. The length of time a sum of money is expected to
be invested (when and how much money will be
needed), or
can be defined as the total length of time that an
investor
expects to hold a security or a portfolio.
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Investment Considerations
5. Accessibility of Fund
A client will need the money to settle a specific event.
With this in mind, we can divide the accessibility of funds
into 3 components :
1. The time when the client needs the fund.
2. Cost/ penalty that the client has to pay if client exits
early.
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Investment Considerations
6. Taxation Treatment
Knowing the implication of tax treatment for the
particular investment portfolio is important before
the investment decisions are made.
It would have the impact on the actual return.
No special tax laws on investment-linked
insurance. The tax status is the same as traditional
with profit life insurance products.
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Investment Considerations
7. Performance of the Investment
The performance depends on the following factors: :
Countrys and global economic factors.
The competencies and capabilities of the
management team.
Investment Considerations
8. Diversification
Diversification is the process of investing across different
asset classes and across different market segments.
101
Sample Questions
1. An example of investment in Money Markets is
A.
B.
C.
D.
5-Year Bond.
Currencies and Forex.
Treasury Bills.
Savings account.
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Sample Questions
2. People generally want to invest
I.
II.
III.
IV.
A.
B.
C.
D.
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Sample Questions
3. Which statement below explains what a simple
(current) net worth analysis involves?
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
4. The main purpose of an agent conducting a risk profile
on his potential client is
A. to assess whether the potential client is willing to
use a major portion of his savings or liquid assets
to purchase a large investment-linked plan.
B. to help the potential client understand his own
risk profile, i.e. whether he has conservative,
aggressive or balanced risk characteristics, and
also to consider the type of asset categories
suitable for his profile.
C. to assess whether the potential client will be
attracted to the product/s being offered.
D. to assess whether the potential client is willing to
forego some of his existing liquid assets in order to
buy an investment-linked product.
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Sample Questions
5.
I.
II.
III.
IV.
A.
B.
C.
D.
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Sample Questions
6. Which of the following statements is correct?
A. Diversification means spreading out investment in
different asset categories or fund types.
B. Diversification not only means spreading out
investment in different asset categories or fund
types, but also acquiring various assets of the
same category or fund type.
C. Investment-linked funds in Malaysia confine the
investment diversification to assets in the country
as a way of discouraging the outflow of funds.
D. When the stock market shows signs of going up, an
investor should give key focus to leverage the
market trend and switch all fixed income or bond
assets to equities.
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Chapter 6
TYPES OF
INVESTMENT
VEHICLES AND
POTENTIAL RISKS
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8 Bonds
9 Capital Guaranteed Funds
10 Commodities
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Central Bank
Institution
Discharged at face value
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No.
Advantages
1
Very safe.
Guaranteed
marketability and
income for the future.
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Disadvantages
In times of high
inflation, capital can be
eroded.
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Disadvantages
More riskier than
government bonds
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Advantages
1 Investors participate
directly in the future of
the company
Disadvantages
High risk
4) Unit Trusts
1. A pool of funds contributed by many investors
kept in trust by a trustee (usually a bank) and
managed by a professional fund manager.
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4) Unit Trusts
Investors
Trustee
Open-ended fund (usually bank)
kept the fund;
govern by trust deed.
Fund Manager
to manage.
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4) Unit Trusts
3. Unit trusts have no fixed redemption date.
4. The investment in unit trusts could generate
income in the form of
a) Dividends
b) Interest
c) Capital gains.
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4) Unit Trusts
Advantages and Disadvantages of Unit Trusts :
Advantages
Disadvantages
Bewildering array of
funds
Extra costs or charges
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5) Properties
3 types of real estate investment:
a. Agricultural property
b. Residential property
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5) Properties
Advantages
Good capital
appreciation
Disadvantages
Difficult to be
disposed off during
recession
Low risk
By mortgaging, capital
can be free
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Disadvantages
Good capital
Economic recession,
appreciation and steady
property could be
flow of income
difficult to be disposed
off
Low risk
Mortgaging the property,
capital can be freed
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9) Commodities
1) Represent an avenue for investors to venture out of
stocks or bonds.
2) Gaining from price movements.
3) One of the way is by futures contract
Agreement of buy/sell specific quantity, specific price
Categorized as a derivative product
Entails speculating future price movements
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Sample Questions
1. Malaysian Treasury bills are debt instruments that are
considered safe because
I.
II.
III.
IV.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
2.
II.
III.
IV.
A.
B.
C.
D.
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Sample Questions
3.
I and II
I, II, III and IV
II, III and IV
I and III
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Sample Questions
4. Which of the following statements about Real Estate
Invest Trusts (REITs) is NOT true?
A. REITs operate in a way similar to unit trusts.
B. Rental income from the properties invested by a
REIT is distributed to investors in the form of
dividend.
C. A REIT can invest in a wide range of properties like
malls, office blocks, apartments, commercial lots,
hotels, etc.
D. REITs may acquire shares in property development
companies.
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Sample Questions
5. Which of the statements below is incorrect?
A. Sukuk are like bonds but they are based on Shariahcompliant principles.
B. Malaysia is the worlds largest issuer of sukuk.
C. Sukuk securities are issued by Malaysia in Ringgit
only.
D. Sukuk securities issued by Malaysia can be in USD.
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Sample Questions
6.
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Chapter 7
COMMON TYPES OF
INVESTMENT-LINKED
FUNDS
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Investment Vehicles
Remark
Cash/bank deposits
Low risk,
secure
Bond/Income
/Fixed
Income
Government/Corporate bonds
Equity
Capital
appreciation
Cash
Property and
REITs
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Illiquid asset
158
Investment Vehicles
Managed
Balanced
Specialised
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Based on geographical
regions or particular
industries
ASEAN fund, China fund,
mining, plantation, etc.
Remark
Moderate
Risk of
currency
exchange
159
Types of IL Funds
Types of
Funds
SUKUK
Investment Vehicles
Remark
Low risk
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Equity
Funds
Managed
Funds
Bonds
Funds
Derivatives
Property
Funds
Balanced
Funds
Cash Funds
Return
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Bond
Equities
Debt funds
Features
Lower risk
Risk
Higher risk
Stable
Return
Higher
(Depending on stock market)
5.84%
5.69%
3.87%
3.51%
2.35%
2008
2009
2010
2011
2012
2013
Year
163
To Conclude:
a) Bond fund: Low Risk/Volatility = Low Return
b) Equity fund: High Risk/Volatility = Higher Return
BUT !
**Note that higher risk (Equity fund) will face a steeper drop in return
than bond funds when market faces downturn
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Advantage
of IL funds
Services from
professional fund
managers
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Sample Questions
1. Sukuk is gaining ground in terms of transaction volumes in
Malaysia, including for investment-linked funds because
I. this investment vehicle is becoming more popular
among investors.
II. of the strong support from the Government and mega
corporations, especially Malaysian ones.
III. of its higher return experience compared to
conventional bonds because of special incentives
provided by the Government.
IV. it is traded only in Malaysian Ringgit.
A.
B.
C.
D.
I, II and III
I and II
II and III
I, II, III and IV
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Sample Questions
2. The average yield of Malaysian Treasury bills with
tenures of 6 to 12 months is
I. around or slightly better than 3%.
II. normally around 4 to 5 per cent.
III. normally of very low volatility ratio but in periods
when the Government embarks on mass mega
projects and needs funding, it may issue bills with
yields as high as corporate bonds.
IV. with wide variance, depending on the type of bill.
A. I
B. II and IV
C. I, II, III and IV
D. IV
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Sample Questions
3. If is safer to rely on professional fund managers
appointed for investment-linked funds than to invest
directly in the stock market because
I.
an ordinary individual is generally not equipped to identify the
right stock that will reap gain.
II. the professional fund managers role is to ensure the assets and
vehicles achieve a certain minimum growth rate according to
the various stages of time span; otherwise, the fund managers
and life insurer will be obligated to make up the shortfall.
III. it is not easy for an ordinary individual to pick the right time to
buy and the right time to sell for optimising capital gains.
IV. ordinary individuals, especially those occupied with work, do
not have the time and knowledge to properly monitor market
trends.
A.
B.
C.
D.
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168
Sample Questions
4. Malaysian bonds are deemed to be
I. more volatile than global bonds.
II. less volatile than global bonds.
III. rated at very high preference because the
countrys economy is growing vibrantly.
IV. experiencing better yields than global bonds for
many years.
A.
B.
C.
D.
I and III
II
III and IV
IV
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Sample Questions
5. Compared to government bond funds, corporate bond
funds have
I. lower yields and lower risks.
II. higher yields and higher risks.
III. more or less similar yield and risk ratios.
IV. a longer tenure.
A.
B.
C.
D.
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Sample Questions
6. If an insurer has an investment-linked fund tracking the
FBM-KLCI index, it means
I.
the fund manager refers to the index as the benchmark for
guiding the funds investment strategy and also the return
targets in the ensuing years.
II. the insurer is obligated to grant the returns according to the
ratios experienced by the index. If the actual return of the
fund in any period is lower than that shown by the index, the
insurer will top up the difference. .
III. the fund invests in the same stocks of the companies
identified by the index.
IV. the fund invests in stocks of companies in the same
industries as the companies identified by the index.
A.
B.
C.
D.
I and IV
II
I and II
III
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171
Chapter 8
PERTINENT
GUIDELINES ON
INVESTMENT-LINKED
BUSINESS
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Valuation of units
Carry out every business day
173
Premium holidays
Insurers to seek policy owners consent before
deducting
Requirement for min. death benefits
not applicable with top-up premiums
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X%
Y%
Equity
2%
9%
Managed
3%
8%
Bond
4%
7%
177
Sample Questions
1. Valuation of units in an investment-linked fund must
be done
A.
B.
C.
D.
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Sample Questions
2.
B.
C.
D.
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Sample Questions
3.
A.
B.
C.
D.
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Sample Questions
4.
II.
III.
IV.
A.
B.
C.
D.
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181
Sample Questions
5.
The low and high projection for an equity fund should not be above
2% and 9% respectively for the first 20 years.
II.
The low and high projection for a managed fund should not be
above 3% and 8% respectively for the first 20 years.
III.
The low and high projections for a fixed income/bond fund should
not be above 4% and 7% respectively for the first 20 years.
IV.
A.
B.
C.
D.
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182
Sample Questions
6.
II.
The initial offer period shall not be more than 2 months from
the date of launch.
III.
IV.
The insurer will also have to pay interest or profit from the
premiums collected during the initial offer period to the
intended policy owners.
A.
B.
C.
D.
I and II
I, III and IV
I, II, III and IV
I, II and III
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183
Chapter 9
AGENTS
PROFESSIONAL
APPROACH AND
GUIDELINES
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Marketing
Objective:
The management process responsible for
identifying, anticipating and satisfying
customers requirements profitably
The objective of satisfying customers requirement can be
achieved through:
usage of financial needs analysis
knowing customer tools
sales illustrations
185
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Selling Techniques
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186
1. Problem recognition
2. Information search
3. Evaluation of
alternative process
4. Purchase
5. Post purchase
evaluation
Selling Process
1. Locating of
prospective customer
2. Creating sales
presentation
3. Conducting sales
interview
4. Handling objections
5. Closing the sales
187
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Purchase
Problem
Recognition
Information
Search
PostPurchase
Evaluation
Evaluation
of
Alternative
Policies
188
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Personal details
Personal and family circumstances
Objectives regarding needs, i.e. protection, retirement
Risk appetite or tolerance
Elements identified in a financial needs analysis
Advice by agent/intermediary
Recommendation of appropriate product by the
agent/intermediary
8. If policy owner prefers specific product information only,
he/she should declare in form
9. Signature by new policy owner
10.Signature by agent/intermediary
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189
190
4) Purchase
Make the decision to purchase one of the alternative
products
5) Post-purchase evaluation
Keeps in contact with customers
Provides important information of risk evaluation
Better chance of securing the loyalty of the customer
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Locating
Prospective
Customer
Sales
Presentation
Conducting
Sales
Interview
Handling
Objections
Closing the
sale
192
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Visual aids
Must use sales brochures or sales illustrations authorized by
insurer
Creating interest
Create a product to satisfy prospects need
193
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Handling
Objections
Presentation
Interview
194
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195
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Explain
contractual
provisions
Agents return
signed slip to
insurer
**15 days cooling-off period commences from the date of policy delivery
acknowledged by policy owner.
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1. Statement of
Philosophy
2. Coverage
3. Monitoring
Devices
4. Seven Principles
of the
Guidelines
5. Code of
Conduct
1.
2.
3.
4.
1. Introduction
2. General Sales
Principles
3. Explanation
4. Disclosure of
Underwriting
Information
5. Accounts and
Financial
Aspects
Introduction
Claims
Proposal Forms
Policies and
Accompanying
Documents
5. Sales
Materials/Adver
tisements
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A. Statement of Philosophy
1. Behaving with Complete Integrity and ethics in an
Insurance Agent's Professional Life.
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B. Monitoring Devices
The management of a life insurance company shall establish the
following minimal procedures :
1.All employees and intermediaries to sign a declaration.
2.Heads of department to ensure compliance with the guidelines.
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2.
3.
4.
5.
6.
7.
200
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201
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Part II Life
Insurance Selling
1. Statement of
Philosophy
2. Coverage
3. Monitoring
Devices
4. Seven Principles
of the
Guidelines
5. Code of
Conduct
1. Introduction
2. General Sales
Principles
3. Explanation
4. Disclosure of
Underwriting
Information
5. Accounts and
Financial
Aspects
1.
2.
3.
4.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Introduction
Claims
Proposal Forms
Policies and
Accompanying
Documents
5. Sales
Materials/Adver
tisements
202
Introduction
The term 'life insurance' used in the Code of Ethics and
Conduct covers all types of:
1. Ordinary life insurance
2. Annuities
3. Pension Contracts
4. Investment-linked insurance
5. Permanent Health Insurance
203
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205
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206
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207
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Part II Life
Insurance Selling
1. Statement of
Philosophy
2. Coverage
3. Monitoring
Devices
4. Seven Principles
of the
Guidelines
5. Code of
Conduct
1. Introduction
2. General Sales
Principles
3. Explanation
4. Disclosure of
Underwriting
Information
5. Accounts and
Financial
Aspects
1.
2.
3.
4.
Introduction
Claims
Proposal Forms
Policies and
Accompanying
Documents
5. Sales
Materials/Adver
tisements
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Introduction
Aim is to reduce formalities involved in the issue of new
policies and payment of a claim.
Audit/disciplinary committee of insurer monitors the
insurers compliance with guidelines.
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A. Claims
Guidelines:
a) Insurer may not reject claim unreasonably
b) Claims have to be settled without delay
c) Insurer shall not collect claim processing fees from
policy owner
B. Proposal Forms
Proposal forms based on Code of Good Practice for Life
Insurance business (Part III)
a) Proposal form Disclosure of material facts should be
stated in the declaration
212
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213
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214
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Sample Questions
1.
III.
IV.
A.
B.
C.
D.
I, II and IV
I and III
II and IV
II and III
TMTDA/ADA/CEILLI/PPT/Eng/August2015
215
Sample Questions
2.
III.
IV.
A.
B.
C.
D.
I and II
II and III
I, II, III and IV
I, III and IV
TMTDA/ADA/CEILLI/PPT/Eng/August2015
216
Sample Questions
3.
I.
II.
III.
IV.
A.
B.
C.
D.
I, II and IV
II, III and IV
I, II, III and IV
III and IV
217
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Sample Questions
4. The Code of Conduct pertaining to life insurance
selling applies to
I.
II.
III.
IV.
all agents.
all employees of life insurers.
insurance brokers.
agents and insurance brokers.
A.
B.
C.
D.
TMTDA/ADA/CEILLI/PPT/Eng/August2015
Sample Questions
5.
II.
III.
IV.
A.
I, II, and III
B.
I, II, and IV
C.
II and IV
D.
I and IV
TMTDA/ADA/CEILLI/PPT/Eng/August2015
219
Sample Questions
6.
III.
IV.
A.
B.
C.
D.
I, II, and IV
I, II, and III
II and III
I, II, III, and IV
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220
221
221
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TMTDA/ADA/CEILLI/PPT/Eng/August2015
Thank You
223
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