501. State which of the following statement is true.

Statement A: When the nominee is a minor and there is no appointee, claim will be paid only to the legal
heirs of the decreased life assured.
Statement B: When the nominee is a minor and there is no appointee, claim can be paid to the guardian.
A. Both Statement A & B are True
B. Only Statement A is True
C. Only Statement B is True
D. Both Statement A & B are False

502. Need analysis basically involves

A. Needs explaining
B. Needs sequencing
C. Ne e ds pr i ori ti z a ti on
D. None of the above

503. A village consists of 400 houses is valued at Rs. 25,000/- In the village on an average 6
houses get burnt every year. Suggest contribution payable by each owner to share the above loss?
A. Rs.375
B. Rs. 400
C. Rs. 480
D. Rs. 385

504. Deduction available for taking medical insurance for a senior citizen member in the family
under sec 80 D is up to
A. Rs. 25,000
B. Rs. 20,000
C. Rs. 15,000
D. Rs, 10,000

505. Calculate the policy cost per thousand with the given data
Bonus= Rs. 13,000 Sum assured= Rs. 20, 00,000
Interest rate= 10% Annual premium= Rs.23, 000
Cash surrender value at the end of current year= Rs. 6, 00,000
Cash surrender value at the end of previous year= Rs. 5, 70,000
A. 33
B. 28.07
C. 25
D. 32

506. State which one of the following statements is correct?

A. An absolute assignment holds good even after maturity
B. A nomination holds good only till maturity
C. Both statements are correct
D. Both statements are wrong

507. State which of the following statements is correct?

A. When a nomination is made, the rights to the policy are transferred
B. The assignee immediately becomes the policyholder
C. Both the statements above are correct
D. Both the statements above are wrong
508. Which one of the following statements is correct?
A. A nominee must be above 18 years of age.
B. A nominee must be a closer relative
C. Both the above statements are correct
D. Both the above statements are wrong

509. State which of the following statement is true.

Statement A: Whenever the wording in an endorsement or rider is in conflict with the terms of The policy
to which it is attached, the endorsement or rider takes precedence.
Statement B: One reason for exclusion in insurance policies is that the risks are covered by other
insurance.
A. Only Statement A is True
B. Only Statement B is True
C. Both Statement A & B are True
D. Both Statement A & B are False

510. Capital Required = Living Expenses x Years Required. This is the formula for the:
A. Future value approach
B. Annuity approach
C. Needs approach
D. Multiple approach

511. Mohan earns 55,000 p.a. He estimates that his family would require 80% of his income in the event
of his death or disability. Using the annuity approach, what is the required lump sum if the investment
returned 5% per annum?
A. 2,750,000
B. 220,000
C. 1,40,000
D. 880,000

512. Sohan was driving his car home from work, when a pit dug by the municipal corporation in the road,
remained open and unmarked. He met with an accident and had to be hospitalized for 3 months. What are
the insurance claims that can arise from this accident?
A. Sohan can claim personal insurance for the accident, as it was not caused by negligence on his
part; the municipal corporation cannot claim third party loss insurance to pay damages to Sohan,
as it was negligent. Sohan can claim insurance for damage due.
B. Sohan can claim temporary disability insurance and insurance for his damaged car
C. Sohan has to apply to the municipal corporation for damages, which the corporation will pay out of
its claims for liability to third party. His motor insurance will cover damages to his car.
D. Since the municipal corporation was negligent, it would not be able to lodge a claim to recover
payment of damages to Sohan. Sohan will only receive motor insurance claims on his car.

513. Amita was standing on the terrace of her building hanging out clothes. She accidentally fell off and
landed on the sunshield of the next floor, which crashed and damaged the car of her neighbor parked
below. What are the insurance claims that arise from this event?
A. Amita can claim personal accident insurance. Both her neighbors will claim property insurance for
the freak accident.
B. Amita cannot claim accident insurance as the accident was caused by her negligence. Her
neighbors can claim property insurance cover for loss to their property
 C. Amita's neighbors will collect damages from her, which Amita can pay out of insurance cover for
losses to third parties.
D. Amita's neighbors will not be able to claim insurance, as the damage to their property due to such
freak accidents is not usually covered by insurance. Amita will be able to claim her accident
insurance, as she did not fall intentionally

514. Sohan has not bought accident insurance cover, though his two-wheeler is covered for damages from
accidents. He wears a helmet and drives carefully. What can you say about his risk management?
A. Sohan has insured the property risk. He controls some of his personal risk and retains the rest of
the risk.
B. Sohan has controlled his personal risk and insured his property risk
C. Sohan has not done anything to manage his risks and has to immediately go for accident and
personal risk cover. He cannot rely on third party damages alone to cover the risk of the road.
D. Sohan has transferred his personal risk to other drivers of the road, insured his property risk and can
claim damages is accidents are caused by third party negligence.

515. An entrepreneur who was into manufacturing corrugate boxes also owned few photocopying
machines and also ran courier and fax services, sought a single comprehensive protective non-life
insurance cover from an insurance company. The insurance company declined the business based on
the principle of
I. " Measurability and definiteness of loss"
II. " Large number of homogenous exposure units"
A. Statement A alone is correct
B. Statement B alone is correct
C. Both statements A and B are incorrect
D. Both statements A and B are correct

516. Which one of the following statements is correct?

A. An assignee can assign the policy further to another person.
B. The assignee can take a loan under the policy
C. Both the above statements are correct
D. Both the above statements are wrong

517. (A) Gambling or wager creates the risk by its act of betting on it
(B) The chance of loss exists in life, whether or not the risk is insured
A. Statement A alone is correct
B. Statement B alone is correct
C. Both statement A and B are incorrect
D. Both statements A and B are correct

518. Every employer is obliged to ensure that his employees get a safe and secure workplace. In relation
to the risks arising in the workplace which affects the employees, cover is provided through
A. Employees' Provident fund
B. Workmen's compensation insurance
C. Employees' group life insurance
D. Employees' personal accidents insurance scheme

519. Shri. Mohan is an assistant manager in a private firm. His present age is 35 years and he is to retire
at age 60.His present net salary per annum is Rs.240000. Total life insurance premium as on date
including children and wife's policies come to Rs.15000 p.a. Income tax and professional tax amount to
Rs.35000. Reasonable self —maintenance expenses including entertainment, sports, club membership,
recreation etc are Rs.30000.Medical expenses are being reimbursed by the company. Calculate the
amount of insurance required using HLV method? Assume discount rate to be 8% p.a.
A. Rs.1850000
B. Rs.1844600
C. Rs.1689000
D. Rs.1900500

520. Mohan born in 1950 has a life expectancy at birth of 65 years. Namita his wife born in 1955 has a life
expectancy at birth of 70 years. Assuming that the life expectancies have not changed. Mohan is
planning to buy an annuity to be paid to him or his wife till anyone of them is alive. Mohan will retire on
attaining age 58 i.e. in 2008
A. 4 years
B. 12 years
C. 7 years
D. 17 years

521. Under the event of the death or serious disabilities of spouse (home maker), the economic consequences to
be covered by financial planning are
A. Day care for dependent children
B. Costs to meet domestic chores hitherto attended by spouse
C. Income substitution, if earning
D. All of these

522. Which one of the following statements is correct?

A. Age is material information and may affect the terms of underwriting.
B. If age is found to be different, the only effect is on the premium rate.
C. Both the above statements are correct
D. Both the above statements are wrong

523. HLV explains in general:

A. Total income of an individual
B. Total worth of an individual
C. Total wealth of an individual
D. Present value of Earning Capacity

524. Adverse loss ratio refers to:

A. Higher premium being received by the insurer
B. Lower premium being received by the insurer
C. Lower than expected claim ratio in the pool
D. Higher than expected claims ratio in the pool

525. Which policy meets the need of "Security after retirement" the best?
A. Term assurance plan
B. Children deferred assurance plan
C. Deferred annuity plan
D. Health insurance.

526. Calculate HLV to recommend adequate insurance cover; Mr. Mohan, aged 30 yrs, retirement
age 60 years. He is Asst. Vice President. His monthly salary is 55,000. he pays professional tax of Rs.
3000 and income tax of Rs. 132000 Reasonable .self-maintenance expenditure estimated Rs. 45000 p.a.;
life insurance premium for self Rs. 18000 with total sum assured Rs.1200000. For wife and child he pays
insurance premium of Rs. 10500 and Rs.6500 respectively rate of interest assumed for capitalization of
future income is at 8%. Adequate additional insurance recommended is
A. Rs. 50,00,000
B. Rs. 40,00,000
C. Rs. 55,00,000
D. Rs. 10,000,000

527. Calculate the HLV of Mr. Sohan His present age 45 years. His retirement age is 70 yrs. His total
income of Rs. 21,00,000 (Salaries 15 Lakhs, dividends on individual shares 2.5 Lakhs, HUF co-
partner profit share 1.5 Lakhs, interest on bank deposit and other investment 1 Lakh, minor
daughters income added 1 Lakh.) he has paid following taxes: Corporate professional tax 5000
income tax 410000 as per individual tax return filed. He pays total life insurance premium of Rs.
55000 (self insurance cover S.A. 22,00,000) Reasonable maintenance charge for a person of his
stature is assumed as Rs. 100000 p.a. applied rate of interest to arrive at a present value of his
future income is at 5%
A. Rs. 2.26 crores
B. Rs. 3 crores
C. Rs. 1.31 crores
D. Rs. 12 crores

528. A planner and prospect agreed for an endowment policy for Rs. 4 Lakhs limited payment for
10 years with a term of 20 years. If reversionary bonus is taken as 7.5% per annum and terminal
bonus as Rs. 150 per 1000 what will be maturity value?
A. Rs. 10,50,000
B. Rs. 10,60,000
C. Rs. 10,70,000
D. Rs. 10,80,000

529. Mohan, 36 years and married, works for a multinational firm, which provides adequate
medical and related covers. He is also able to accumulate sick leave. He already owns a house and
has savings of Rs. 35 Lakhs, which are well invested. Which insurance cover does he require the
most?
A. Life Cover
B. Medical Cover
C. Property Insurance
D. Temporary Total Disablement Cover

530. Insurance protects oneself against losses as a result of lawsuits.

A. Life
B. Medical
C. Professional Indemnity
D. Home

531. Which of the following statements is (are) true with respect to the human life value
approach?
I. The human life value approach considers all sources of income that the family receives.
II. The human life value approach does not consider the time value of money—future cash flows
 are not discounted back to present value.
A. II only
B. Neither I nor II
C. I only
D. Both land II

532. Two ways of assessing life insurance needs is a need based approach and the other is the income
replacement method. What in your judgment would be the additional life cover required for Mr.
Rohan on the basis of each of the two approaches. Mr. Rohan is the sole income earner in the
family. Mrs. Amita is a homemaker. They are aged 40 and 36 respectively. Life expectancy
for both of them is another 40 years. They have no children. Other information you have is: Current
investment port folio - Rs. 20 Lakhs; Estimated final Expenses - Rs. 1 Lakh; Present annual expenses-Rs.
3 Lakhs (including a Lakhs of Mr. Rohan's personal expenses); Mr. Rohan's post-tax income in hand-Rs.
3.5 Lakhs; Assume a post tax, post inflation return/ discounting factor of 3%.
A. Rs. 28 Lakhs; Rs. 40 Lakhs
B. Rs. 46 Lakhs; Rs. 58 Lakhs
C. Rs. 26 Lakhs; Rs. 58 Lakhs
D. Rs. 28 Lakhs; Rs. 60 Lakhs

533. Income, Income plus expenses, Multiple of salary are all methods of calculating insurance need by
A. Research
B. Rule of thumb
C. Past record
D. None of the above

534. Your client has bought life insurance and medical insurance, but has not bought a cover for permanent
disability. His argument is that he is paying too much by way of premium for risks that he believes are
"far-fetched" and "not likely to affect him". What would you advise the client?
A. A financial planner can guide the client to consider the losses from permanent disability and
highlight the risks to the client and recommend an appropriate policy for him.
B. If a client is not willing to bear the costs of premium, it can be assumed that he is willing to bear
the costs of risk retention. Insurance may not be necessary in such cases.
C. If losses that would occur to the client in the event of permanent disability are higher than what
he can bear, the client is better off buying insurance.
The costs of insuring against losses, which have lower probability of happening, will in any
D. The amount of insurance a person will buy depends on his perception of risks and their impact on
him. It would not be possible to persuade this client to buy more insurance.

535. Which one of the following statements is correct?

A. The requirement of medical examination varies according to the duration of lapse.
B. The requirement of medical examination depends on the SA.
C. Both the above statements are correct
D. Both the above statements are wrong

536. SWB Institute of Financial Markets has a great Education Centre and a full business. Dr. Shah, Head
Academics is held in high esteem nationwide for his expertise, knowledge and lecture delivery. He has
made an outstanding contribution for the last 8 years to enable market leadership for SWB Institute of
Financial Markets. The most appropriate policy that the owners may take in the interests of business
on the life of Dr. Shah would be
A. Personal Accidental Insurance
 B. Term Insurance
C. Key Man Insurance
D. Any of the above

537. The gross income of a person is at Rs 3 Lakhs when the average tax rate is 20%. Due to the receipt
of an additional sum of Rs. 2 Lakhs the average rate goes up to 25%. If there is then an additional sum of
Rs. 50000 spent for own expenses then the amount remaining for the f a m i l y a r e
A. Rs. 325000
B. Rs. 375000
C. Rs. 425000
D. Rs. 450000

538. Given the following data, state which one of the following is the correct amount of the claim payable
under the policy?
Plan and term endowment 40 years
Sum assured Rs. 50000
Date of commencement 20.02.1989
Date of death of life assured 18.02.2002
Quarterly premium Rs. 300 due in February 2002 paid on 6th February 2002
Bonus vested Rs. 36000
Interim bonus declared after valuation on 31.03.2001. Rs. 68 per thousand.
A. Rs. 86000
B. Rs. 89400
C. Rs. 86300
D. Rs. 89700

539. Proximate cause in general insurance means

A. The insured peril
B. The excluded peril
C. The direct cause that caused the loss
D. None of the above

540. The doctrine of 'caveat emptor' governs

A. Commercial contracts
B. Marine insurance contracts
C. Group insurance contracts
D. All general insurance contracts

541. A person lives in a nuclear family consisting of his wife and two children. He wants to assume his
premium needs at 5 per cent for himself plus 1 percent for other members of his family. He has an income
of Rs. 5 Lakhs and an expense figure of Rs. 3 Lakhs during the year. The expense is expected to go up to
Rs. 3.25 Lakhs next year. The amount of insurance cover r e q u i r e d h e r e i s
A. Rs. 5 Lakhs
B. Rs. 10 Lakhs
C. Rs. 15 Lakhs
D. Cannot be determined

542. A person lives in a nuclear family consisting of his wife and two children. He wants to assume his
premium needs at 5 per cent for himself plus 1 percent for other members of his family. He has an income
of Rs. 5 Lakhs and an expense figure of Rs. 3 Lakhs during the year. The expense is expected to go up to
Rs. 3.25 Lakhs next year. The maximum amount of premium that will be used for buying insurance
cover will be
A. Rs. 40000
B. Rs. 45000
C. Rs. 50000
D. Cannot be determined

543. A person lives in a nuclear family consisting of his wife and two children. He wants to
assume his premium needs at 5 per cent for himself plus 1 percent for other members of his
family. He has an income of Rs. 5 Lakhs and an expense figure of Rs. 3 Lakhs during the year. The
expense is expected to go up to Rs. 3.25 Lakhs next year. As a Financial Planner find out the
amount of premium that will be used for the insurance cover by employing "Premium as a
Percentage of Income Method".
A. Rs. 40000
B. Rs. 41000
C. Rs. 16000
D. Rs. 14000
E. None of the above

544. A person lives in a nuclear family consisting of his wife and two children. He wants to
assume his premium needs at 5 per cent for himself plus 1 percent for other members of his
family. He has an income of Rs. 5 Lakhs and an expense figure of Rs. 3 Lakhs during the year. The
expense is expected to go upto Rs. 3.25 Lakhs next year. As a Financial Planner find out the
Total Insurance cover he can avail by using the "Premium as a Percentage of Income Method"
(Note Insurance Premium for his age is Rs. 4.00 per Rs. 1000 sum assured).
A. Rs. 62.5 Lakhs
B. Rs. 100 Lakhs
C. Rs . 40 La khs
D. Rs. 102.50 Lakhs

545. In case of a need that will amount to Rs. 3 Lakhs for 5 years after a period of 3 years and
where the _____ rate prevailing is 5 % then this figure converted to an insurance need today
comes to
A . R s . 11 7 8 0 8 9
B. Rs . 1121989
C. Rs. 1356474
D. Rs . 1456786

546. The immediate cash needs of an individual will come to Rs. 30000 for the funeral (final
cost) plus Rs. 3 Lakhs as outstanding debt. The Net Income needs at a present value are Rs. 4
Lakhs. With an existing asset base of Rs. 2 Lakhs, compute the insurance required under
"Needs Approach".
A. Rs. 330000
B. Rs. 730000
C. Rs. 530000
D. Rs. 930000
E. None of the above

547. Sohan needs a life insurance policy for Rs. 5 Lakhs that will require a premium
commitment of Rs. 23000 each year for the next 15 years. With an earning potential of 5% the
adjusted interest earning potential comes to
A. Rs. 396406
B . R s . 5 2 11 2 2
C. Rs. 596406
D. Rs. 696406

548. What are the two main types of life insurance premiums?
A. Level and Stepped
B. Uneven and Level
C. Even and Stepped
D. Variable and Flat

549. In the event of the life insured committing suicide, what would happen under a term life policy?
A. A claim would be paid in full if the policy had been in force for at least 12 months
B. Partial claim paid, depending on length the policy has been in force
C. The claim would be paid if the policy had been in force for at least 13 months
D. A claim will never be paid in this situation

550. Some whole of life and endowment policies have a surrender value which gives rise to the 'non
forfeiture' principle. Which of the following best describes the 'non forfeiture' principle?
A. The ability to 'skip' a premium without the policy lapsing (so long as the accumulated unpaid
premiums, plus interest, do not exceed the surrender value)
B. The ability to 'skip' a premium without the policy lapsing (so long as the premium is paid within 6
months)
C. The ability to 'skip' a premium without the policy lapsing (so long as the premium is paid within 12
months)
D. The ability to 'skip' a premium without the policy lapsing (so long as the skipped premium, plus
interest, is added to the next premium)

551. If the life insured has NOT nominated a beneficiary:

A. The benefits will automatically be paid to the spouse
B. The benefits will be automatically paid to the policy owner
C. The benefits will paid to the insured's superannuation fund
D. The benefits will be paid to the insured's estate

552 In relation to life assurance, identify the incorrect statement amongst the following:
A. A joint-life policy is payable upon the death of the first of two or more lives insured under the single
contract.
B. A last survivor policy is payable upon the death of the last of two or more lives insured under the
single contract.
C. Even with renewable term insurance, the policy owner/insured would not be permitted to renew the
policy if he or she had contracted a terminal disease prior to the renewal date.
D. With a level premium policy, level premiums in excess of the policy's share of death claims in the
early years of the contract are accumulated at interest in a reserve.

553. The gross premium is obtained by loading the net premium. The loading reflects all of the following
except:
A. A percentage of the premium.
B. A constant amount per 1,000 sum assured.
 C. A constant amount per policy.
D. A factor for investment expenses

554. Participating policies are those where

A. Both insurer and insured participates in each others loss
B. Insured participates in running of insurance of company
C. Insured participates in surplus of insurance company
D. Insurer participates in loss of insured

555. In Unit-Link policy, market risk is with

I. Insured
II. Insurer
A. I
B. II
C. Both I & II
D. Neither I nor II

556. If the life insurance policy is endorsed under MWP Act, 1874 then
A. Creditors have claim only to the extent of outstanding principal, on policy proceeds
B. Creditors have first claim on policy proceeds
C. Creditors have no claim on policy proceeds
D. Creditors have residual claim on policy proceeds

557. (A) Mortality of a life is influenced by age, gender and personal habits.
(B)Under stepped premium method, premium at higher ages would be prohibitive for the life assured.
A. Statement A and B are both correct
B. Statement A and B are both incorrect
C. Statement A alone is correct
D. Statement B alone is correct

558. In a limited payment with profit whole life insurance, while the premium paying period is limited to a
certain number of years, at the time of claim settlement:
A. Bonuses will be paid for the same period as the premium paying period
B. Bonuses for the period commencing from the year of cessation of premium to the claim date will be
paid
C. Bonuses will be paid for the period commencing from the date of risk till the date of claim.
D. None of the above

559. The most important component for cash value (surrender value) accumulation in the early years of the
policy term is the
A. Interest factor
B. Level premium
C. Home office exempts
D. None of these

560. The whole life policy which meets both the needs of providing for assureds dependents as well as
providing for the assureds periodic financial needs is
A. Convertible whole life plan
B. Increasing whole life insurance policy
C. Anticipated whole life plan
 D. Limited payment whole life plan

561. A father takes out a policy to meet his son's enhanced educational needs when the son reaches 18
years of age. Unfortunately after paying 5 years premium, the father dies. By what means can the policy be
kept in force without payment of further premiums so that the intended benefits are retained.
A. Accident benefit premium
B. Lien On policy
C. Premium waiver facility
D. None of these

562. The factors affecting computation of premium are:

A. Mortality
B. Rate of interest
C. Management expenses
D. All of the above

563. Unit linked Insurance Plan is designed for ___________

A. Residents in India
B. NRI's
C. Both residents in India and NRI's

564. Calculate the paid up value under a policy with the following particulars.
S A (sum assured) =Rs.25000 Plan and Terms Endowment- 25 years DOC (date of
commencement) 14.06.1989 Mode =quarterly Last premium paid 14.03.1997.
A. Rs.8000
B. Rs.4000
C. Rs.7500
D. Rs.8500

565. Claim is the demand on the insurer for _________

A. Policy money
B. Performance of promise
C. Terminating the contract
D. All of the above

566. In a death claim no evidence of the claimant title is required if there exists a proper----
A. Assignee
B. Nom i ne e
C. Chi l dr e n
D. Any of the above

567. The term Master Policy is related to insurance cover ______________

A. For servant obtained by his master
B. Obtained by a group of employees for their master
C. Obtained for a number of persons under Group Insurance Scheme

568. Assignment of policy requires prior consent of the insurer in case of

A. Fire & miscellaneous policies;
B. Marine policy
C. Marine hull
 D. A & C

569. Which of the following statement(s) is true?

Statement A: Endorsements are issued during the policy period to record alterations
Statement B: Endorsements are issued as part of the policy at the time of issue
A. Only statement A
B. Only statement B
C. Both statements
D. Neither of the statements

570. That the policyholder can pay the premium on yearly, half-yearly, quarterly or monthly basis is
A. Option
B. Guarantee
C. Rider
D. None

571. Which statement is true with regard to the Children's policy?

A. Risk will commence on the deferred date automatically.
B. Risk will commence on the deferred date after satisfactory medical examination.
C. Risk will commence on the deferred date with enhanced premium.
D. All are wrong.

572. Assets are insured because they may be destroyed due to occurrences.
A. Random
B. Unintentional
C. Accidental
D. All these

573. Which one of the following statements is correct?

A. Only heirs of the insured can be nominees under a life insurance policy.
B. A person to whom one owes moneys can be made a nominee
C. Both the above statements are correct
D. Both the above statements are wrong

574. A policy that has been assigned will revert to the assignor
A. If the assignment is conditional.
B. Whenever the assignor demands it.
C. When the conditions specified in the conditional assignment happen.
D. On maturity of the policy.

575. Which of the following is correct?

A. An indemnity bond is necessary when the heirs challenge the nomination.
B. Heirs claiming the policy monies must be asked to obtain a court decree
C. Both are correct
D. Both are wrong

576. Which of the following is correct?

A. The insurer should ignore a court order attaching the monies under an MWPA policy.
B. The insurer should not become a party to a dispute between rival claimants.
C. Both are correct
 D. Both are wrong

577. Subrogation means

A. Something of monetary value
B. Sharing of indemnity by a group of insurers
C. To make good loss
D. Transfer of rights of an insured to another person

578. Which of the following is correct?

A. On revival, the relevant SA for underwriting is the original SA.
B. On revival, the relevant SA for underwriting is the original SA less paid up value.
C. Both are correct
D. Both are wrong

579. Which of the following is correct?

A. Premiums have to be paid in cash or by cheque.
B. Premiums can be paid electronically.
C. Both are correct
D. Both are wrong

580. Which of the following is correct?

A. Vested bonus is also reduced along with SA in paid up cases.
B. Paid up option is effective from the date of FUP.
C. Both are correct
D. Both are wrong

581. Which of the following is correct?

A. In a limited payment policy, there is a maximum limit to SA.
B. In a limited payment policy, the term cannot exceed a specified limit.
C. Both are correct
D. Both are wrong

582. Which one of the following statements is correct?

A. The premium under a SSS policy is paid monthly.
B. The premium under a SSS policy is less than in a monthly mode.
C. Both the above statements are correct
D. Both the above statements are wrong

583. What is a proposal?

A. A request for insurance cover.
B. An offer to enter into a contract.
C. Both the request and an offer to enter an insurance contract.
D. None of the above.

584. Which of the following is correct with regard to children's policies?

A. They insure minor children.
B. They insure only school going children.
C. Both are correct
D. Both are wrong
585. In a variable insurance policy
A. The policyholder has an option to modify the benefits from time to time.
B. The benefits under the policy are not changeable after commencement.
C. The benefits vary according to the rate of inflation.
D. None of the above statements are correct

586. Adjustments are made to tabular premium because of

A. Recommendations of the agent
B. Age of the person to be insured
C. Frequency of premium payment
D. All the above.

587. State which of the following statements is correct

A. Convertible plans.do not participate in profits
B. Money back policies are not convertible policies.
C. Both statements above are correct
D. Both statements above are wrong

588. State which of the following statements is correct

A. No medical examination is required under an annuity policy irrespective of the amount
B. A diabetic person can be accepted under group insurance policy up to certain amount
C. Both statements above are correct
D. Both statements above are wrong

589. State which of the following statements is correct

A. Smoking is a hazard inviting additional premium
B. Drinking is a hazard inviting additional premium.
C. Both statements above are correct
D. Smoking is a hazard inviting additional premium

590. State which of the following statements is correct

A. Only one policy is issued under group insurance
B. Under a joint life insurance each life is underwritten
C. Both statements above are correct
D. Both statements above are wrong

591. State which of the following statements is correct

A. Nomination can be made in joint life policies.
B. A joint life policy can be assigned.
C. Both statements above are correct
D. Both statements above are wrong

592. Under compound reversionary bonus, bonus declared attaches to

A. Premium paid
B. Term of the policy
C. SA and accrued bonus
D. SA only

593. Money back policy takes care of aspect of

A. Investment
 B. Risk cover
C. Bonus
D. None of the above

594. Policy document consists of

A. Preamble
B. Schedule
C. Operative clause
D. All of these

595. If a policy document is lost, contract

A. Is not lost
B. Is suspended
C. Is cancelled
D. I s l ost

596. State which one of the following statements is correct

A. An absolute assignment holds good even after maturity
B. A nomination holds good only till maturity
C. Both statements are correct
D. Both statements are wrong

597. Under a limited payment whole life policy premiums are payable
A. For a s el e ct e d te rm
B. Up t o a ge 60
C. Up t o a ge 85
D. Up t o de a t h

598. State which one of the following statements is correct

A. The date of payment of premium is the date of the receipt by insurer
B. The date of payment of premium is the date on which the cheque is cleared
C. Both statements are correct
D. Both statements are wrong

599. Bonus which is attached to the policy and is payable along with the basic SA is called
A . To n t i n e
B. Cash
C. Deferred
D. Reversionary

600. State which one of the following statements is correct

A. An effective agent must be able to write articles for newspaper
B. Communication skills includes the ability to listen
C. Both statements are correct
D. Both statements are wrong

601. A missing person will be presumed dead only after

A. 9 years
B. 7 years
C. 3 years
 D. 5 years

602. Adjustments are made to tabular premium because

A. Mode of payment
B. Size of sum assured
C. Method of premium payment
D. All of the above

603. State which one of the following statements is correct

A. Only participating policies are entitled to benefit of bonus
B. The bonus is return of additional premium paid by a participating policy
C. Both statements are correct
D. Both statements are wrong

604. State which of the following statements is correct.

A. A policyholder loses his rights on the policy once the assignment is done.
B. Assignment can be cancelled by crossing / tearing the deed of assignment.
C. Both the statements above are correct.
D. Both the statements above are wrong.

605. Life insurance policy grants Extended Permanent Disability Benefit (EPDB) if caused by
A. Accident
B. Sickness
C. Attempted suicide
D. None of these

606. State which of the following statements is correct.

A. Alterations are generally allowed if they do not affect the risk.
B. Alterations are generally allowed if they do not increase the risk.
C. Both the statements above are correct.
D. Both the statements above are wrong.

607. State which of the following statements is correct.

A. On revival, the original terms of the policy will not be affected.
B. On revival, the original terms of the policy may be changed.
C. Both the statements above are correct.
D. Both the statements above are wrong.

608. The addition to the life fund arises because of the

A. Loading in the premium for bonus.
B. The practice of charging level premiums.
C. Not having paid the claims on time.
D. All the above reasons.

609. State which of the following statements is correct.

A. The beneficiaries under the MWP Act can be any member of the family.
B. A policy can be taken under the MWP Act for the benefit of partners.
C. Both the statements above are correct.
D. Both the statements above are wrong.
610. State which of the following statements is correct.
A. A policy is specific and relevant only to a particular contract.
B. A policy is a specimen, applicable to all cases under a specified plan.
C. Both the statements above are correct.
D. Both the statements above are wrong.

611. State which of the following statements is correct.

A. The proposal must be signed in the language in which it is printed.
B. The proposal can be signed in any language.
C. Both the statements above are correct.
D. Both the statements above are wrong

612. State which of the following statements is correct.

A. Any policy which promises a payment on a fixed date is an endowment policy.
B. If the sum assured increases every year, it is a participating policy.
C. Both the statements above are correct.
D. Both the statements above are wrong.

613. State which of the following statements is correct.

A. The name given to a plan indicates the benefits available under a plan.
B. Every plan of insurance is a combination of two basic plans.
C. Both the statements above are correct.
D. Both the statements above are wrong.

614. In maturity of the policy, nomination

A. Ends
B. Is cancelled
C. Continues
D. None of these

615. Mrs. Kavita, a 40-year-old widow, has a 8-year-old son. Her current savings are not adequate to
provide for her son's post graduate studies however she will be able to save it up by the time he finishes
graduation i.e. when he is 20 years old. Mortality tables indicate that her life expectancy is another 30
years. Which of the following is true?
A. She needs to insure her life for 12 years
B. She does not need to insure her life
C. She needs to insure her life for 30 years
D. She needs to insure her son's life for 30 years

616. Which one of the following statements is correct?

A. A 'Lien' operates for a specific period.
B. A 'clause' excludes specific risks
C. Both the above statements are correct
D. Both the above statements are wrong

617. The cheapest policy amongst the following policies in the market is
A. A term policy
B. A unit linked policy
C. An endowment policy
D. A Whole life policy
618. Participating polices are policies entitled to
A. risk sharing
B. premium
C. bonus
D. fixed payments

619. An increasing term insurance means

A. The term insurance sum assured increases with inflation
B. Both the premium and sum assured increases
C. The term insurance sum assured increases at intervals
D. Only the premium keeps on increasing

620. A substandard Indian life is

A. an individual with health problems
B. below average intelligent Indian life
C. a life which cannot be insured
D. dependent on the underwriting standards of the insurance company

621. Which one of the following statements is correct?

A. Working women are treated on par with men.
B. Educated women are treated on part with men.
C. Both the above statements are correct
D. Both the above statements are wrong

622. Which of the following is not a classification of term insurance policy?

A. sum assured with bonus return term insurance
B. Level benefit term assurance
C. Increasing benefit term assurance
D. Decreasing benefit term insurance

623. A group of 50000 persons each aged 35 years wish to apply for term insurance for a one year period
for a sum of Rs. 2,00,000. If mortality tables show that out of 50,00,000 people 30,000 die within a year,
find the premium to be paid by each of the 50000 applicants.
A. 1200
B. 1250
C. 1300
D. 1400

624. A group of 75000 persons each aged 33 years wish to apply for term insurance for a one year period
for a sum of Rs.2, 50,000. If mortality tables show that out of 100, 00,000 people 25,000 die within a year,
find the premium to be paid by each of the 75000 applicants.
A. 625
B. 700
C. 750
D. 800

625. A group of 45000 persons each aged 34 years wish to apply for term insurance for a one year period
for a sum of Rs. 3,50,000. If mortality tables show that out of 60,00,000 people 30,000 die within a year,
find the premium to be paid by each of the 45000 applicants.
 A. 1650
B. 1700
C. 1750
D. 1800

626. A group of 55000 persons each aged 40 years wish to apply for term insurance for a one year period
for a sum of Rs. 3,00,000. If mortality tables show that out of 75,00,000 people 50,000 die within a year,
find the premium to be paid by each of the 55000 applicants.
A. 1800
B. 1900
C. 2000
D. 2100

627. A group of 35000 persons each aged 30 years wish to apply for term insurance for a one year period
for a sum of Rs. 3,00,000. If mortality tables show that out of 120, 00,000 people 60,000 die within a year,
find the premium to be paid by each of the 35000 applicants.
A. 1500
B. 1250
C. 1400
D. 2750

628. A group of 50000 persons each aged 28 years wish to apply for term insurance for a one year period
for a sum of Rs. 2,50,000. If mortality tables show that out of 50, 00,000 people 25,000 die within a year,
find the premium to be paid by each of the 50000 applicants.
A. 1500
B. 1250
C. 1400
D. 2750

629. A group of 60000 persons each aged 45 years wish to apply for term insurance for a one year period
for a sum of Rs. 2,80,000. If mortality tables show that out of 80, 00,000 people 40,000 die within a year,
find the premium to be paid by each of the 60000 applicants.
A. 1500
B. 1250
C. 1400
D. 2750

630. A group of 55000 persons each aged 40 years wish to apply for term insurance for a one year period
for a sum of Rs. 3,00,000. If mortality tables show that out of 60, 00,000 people 55,000 die within a year,
find the premium to be paid by each of the 55000 applicants.
A. 1500
B. 1250
C. 1400
D. 2750

631. The life assured under an endowment without profits policy for 20 years for Rs. 100000/-SA with DAB
rider died on 30th June 2007 committing suicide. The policy was taken on 21 st March 2007 and was
backdated to 1st April, 2006. Determine the amount of claim payable.
A. Not hi ng
B. 1 lakh
 C. 2 lakhs
D. Return of premium

632. A person has a premium due on 15 November. Since he was traveling abroad he has not been able to
pay the premium. After he is back on 25 November can he pay the premium?
A. Yes, because a person can pay premium anytime
B. Yes, because the time falls within the grace period clause of the policy
C. No, because the due date was the last date for payment
D. No, because the premium can only be paid after a month

633. A person wants to ensure that while he has taken the necessary life insurance cover there is also
some protection to him and his family in case there is a serious illness that affects the person, which can
drain him of financial resources. In such a situation one can take the option of which rider?
A. Waiver of premium
B. Accidental death
C. Critical illness
D. Guaranteed insurability

634. When a rider is taken on an insurance policy along with an additional benefit there would be an
additional cost in terms'of
A. Higher premium
B. Lower premium
C. Lower benefit
D. Same benefit

635. Calculate half yearly premium on SA 150000/-on the basis of the following data:
 Plan Term — Endowment 25 years, tabular premium Rs. 53.40 per thousand
 Accepted with DAB extra Re.1 per thousand S.A.
 Occupation Extra Rs. 3 per thousand
 S.A. Rs. 1, 50,000 Rebate Rs. 2
 Yearly Mode = Rebate — less 3%
 Half yearly premium — Rebate — Less 1.5%
 Quarterly premium — Rebate — Nil
 Monthly premium — Rebate — plus 5%
A. 8070
B. 4095
C. 7740
D. 8610

636. Which of the following is / are true regarding the ownership of life insurance?
A policy can only be issued to the insured.
Generally, assigning a policy requires proof that the insured is still "insurable" meaning still in good health.
Only a person with an insurable interest, generally a relative, a business associate, or lender, can be named
as a beneficiary.
The owner can assign (transfer) the policy to whomever he or she chooses, even if the assignee has no
insurable interest.
A. 1, 2, and 3 only.
B. 1 only.
C. 2 and 4 only.
D. 4 only.
637. The amount required to meet the risk of death for a given age in a particular year is called
A. Ri s k pr e mi um
B. Ne t pr e mi um
C. Gross premium
D. None of the above

638. The proposal form includes:

A. Personal details of the client
B. Policy details
C. Information about the insurer
D. Risk factors in insurance business

639. The proposal form has to be signed by :

A. The proposer and witnessed by a third party
B. The proposer and the agent
C. The proposer and the person whose life is to be assured
D. Both A and C

640. The surplus generated from the investment division of an insurance company, which is distributed
amongst the policyholders is called as
A. Bonus
B. Interest
C. Maturity value
D. None of the above

641. Every policyholder is given the option to choose premium payment

A. Mode
B. Frequency
C. Both A and B

642. Term insurance provides benefit

A. Death
B. Survival
C. No
D. Maturity

643. Which of these is provided for under a Term Insurance policy?

A. Only the premium is paid till the date of death
B. Sum assured in case of death
C. Sum assured plus bonus in case of death
D. None of these

644. A Participant Whole Life policy will allow the insurer to participate in
A. The day to day running of the insurance company
B. The board of the insurance company
C. The profits of the company
D. None of these

645. The disadvantage of insurance mechanism includes

 A. Reduction of uncertainty
B. Operating expenses and moral hazard
C. Capital gain and financial risk
D. None of the above

646. Which of these policies refer to a Home Loan/ Mortgage Protection?

A. Credit insurance policy
B. Property insurance policy
C. Policy guaranteeing the mortgage loan
D. None of the above

647. Which of these is NOT provided for by an Educational Life policy?

A. Continued Educational support to an insured individual's children, in case of his death
B. Education to insured individuals up to a certain age
C. Payment of educational expenses at a future time
D. All of these

648. What is a "Cooling off" provision in an insurance policy?

A. When the insured individual can elect to cancel the policy and receive refund of the premium
B. When the insured individual does not have to pay a premium
C. When the insurance company cools off or stops its operations
D. None of these

649. The sum assured received under any policy is taxable if the premiums payable
A. is more than 20% of the sum assured
B. If it exceeds 30%
C. If it exceeds 15` )/0
D. If it exceeds 12.5%

650. Mr. Sohan submitted a proposal on his own life on 1.3.2003. It was completed by the insurer and
the Policy Bond was received by him on 8.3.2003. On 20.3.2003, he returned the Policy Bond stating the
reason for his refusal to accept some of the terms printed in the Policy Bond and asked for refund of
premiums paid. He is entitled to
A. Any refund
B. Half the amount
C. 75 % of the amount
D. No refund

651. Consider the following two cases:

Case 1: After two years of taking out a life insurance policy, the assured dies after complications from
emergency surgery after an acute attack of duodenal ulcer. Enquiries reveal that he had periodic stomach
aches in childhood. Claimant argued that the assured did not disclose this in the proposal, as he did not
consider it a serious enough condition.

Case 2: A doctor applies for life insurance soon after a series of migrane attacks, which he does not
disclose in the proposal papers.
(A) The first is a case of innocent nondisclosure, while the second is one of deliberate disclosure.
(B) The first is a case of innocent misrepresentation and the second one of deliberate
misrepresentation.
A. Both statements A & B are correct
 B. Statement A is correct
C. Statement B is correct
D. None of the above

652. Consider the following two cases:

Case 1: Famous paintings were destroyed in a fire accident in an art gallery.
Case 2: A cargo ship carrying 1000 ton grain was partially ruined by dampness while in transit. In both
cases the items were insured as valued policies
1) The claims under both instances would be settled for the full value at risk.
2) The claims in the first case will be settled for the full value at risk while the second case will be
settled on indemnity basis.
A. Statement 1 is correct
B. Statement 2 is correct
C. Both cases will be settled on indemnity value basis
D. None of the above

653. Calculate the yearly premium for the data given below:
Date of Birth: 19/09/1979
Date of Commencement of Cover: 21/02/2005
Plan Term: Endowment with profits 25 years
Sum Assured: Rs. 1,00,000
Mode Rebate: Yearly-3%, Half-yearly- 1.5%
Sum Assured Rebate:
Upto Rs.49,999 - Re. 1 per thousand
Rs. 50,000 and above - Rs. 2 per thousand
Tabular premium: Age 24 - Rs. 49.50 Age 25 - Rs. 51.75 Age 26 - Rs. 52.50
A. Rs. 4,820
B. Rs. 4,998
C. Rs. 5,020
D. Rs. 5,010

654. What would be the paid-up value and surrender value as on 20.03.2006 for the data given below?
Date of Commencement of Cover: 20.03.1995
Plan Term: Endowment 20 years with profit
Sum Assured: Rs. 20,000
Mode: Half-yearly
Bonus Accrued: Rs. 800 per thousand SA for 10 years duration
SVF: 51.2%
A. Rs. 27500 (Paid-up value) and Rs. 14080 (Surrender Value)
B. Rs. 15,500 (Paid-up value) and Rs. 13,050 (Surrender Value)
C. Rs. 25,000 (Paid-up value) and Rs. 12,800 (Surrender Value)
D. Rs. 26,000 (Paid-up value) and Rs. 13,568 (Surrender Value)

655. From the following data, calculate the amount of claim payable, if the insured dies on
27.10.2005.
Date of Commencement: 13.09.1989
Sum Assured: Rs. 1,00,000
Plan Term: Money back (with profit) 25 years
Last premium paid: 13.09.2004
Three installments of Rs. 20,000 each have been paid in 1994, 1999 and
2004 Assume that bonus declared is Rs.600 per thousand SA. Assume premium: Rs. 4,000 per year
A. Rs. 1,00,000
B. Rs. 64,000
C. Rs. 1,24,000
D. Rs. 1,56,000

656. Calculate the premium from the following data:

Plan: Money Back 20 years
Sum Assured: Rs. 1,00,000; rebate for large sum assured Rs. 2 per thousand
Mode: Half-yearly; rebate - 1.5%
Age: 36 years
Proposal accepted at ordinary rates with double accident benefit
Tabular premium: Rs. 69.25, Premium for double accident benefit is Re. 1 per thousand per
annum
A. Rs. 3,361
B. Rs. 3,461
C. Rs. 3,463
D. Rs. 3,261

657. Calculate half-yearly premium as-on 15.10.2006:

SA: Rs. 3,00,000
Date Of Birth: 16.06.1982
Date of Maturity: 15.09.2036
Term: 25 years
Double Accident Benefit: Re. 1 per thousand
Mode Half-yearly Tabular premium  Age 24: Rs. 49.50
Age 25: Rs. 50.60
Age 26: Rs. 52.00
A. Rs. 6,575
B. Rs. 7,775
C. Rs. 7,575
D. Rs. 6,775

658. Calculate surrender value:

SA: Rs. 1,00,000
Date Of Commencement: 28.03.1985
Last Premium Paid: 28.03.1999
Term: 30 years
Bonus: Rs. 80 per thousand SA
Surrender Value Factor:
72% (for 14 years)
78% (for 15 years)
80% (for 16 years)
Mode of Payment: Quarterly
Date of Calculation: 28.06.1999
A. 83,916
B. 82,620
C. 82,600
D. 114,800

659. From the following data, calculate the loan amount that can be given:
Date of Commencement: 20.08.1990
Plan Term: Endowment with profit, 25 years Sum Assured: Rs. 1,50,000
Last premium paid 20.08.2003 Surrender Value Factor 55% Bonus Accrued Rs. 1,000/1,000
A. Rs. 1,16,000
B. Rs. 1,19,900
C. Rs. 1,20,500
D. Rs. 1,61,700

660. From the following data, calculate the yearly installment:

Sum Assured: Rs. 1,00,000
Plan Term: Endowment Plan 20 years
Date of Maturity: 23.12.2022
Date of Birth: 28.06.1974
Tabular premium
Age 27: Rs. 26.93 per thousand
Age 28: Rs. 27.83 per thousand
Age 29: Rs. 28.37 per thousand
Premium Adjustment:
5% extra for monthly mode
Re. 1.00 less for half-yearly mode
Rs. 1.50 less for yearly mode
Rebate of Rs. 1.50 for sum assured of Rs. 50,000 and above
Assume premium will be paid annually
A. Rs. 1,241
B. Rs. 1,242
C. Rs. 2,483
D. Rs. 2,843

661. A Prospect and Planner agreed for an Endowment Assurance Policy for Rs. 4 Lakhs, limited payment
for 10 years with the term of 20 years. If Reversionary bonus is taken as 7.5% p.a and terminal bonus as Rs.
150/-per 10001-. The maturity value would be
A. Rs. 10,50,000
B. Rs. 10,60,000
C. Rs. 10,70,000
D. Rs. 10,80,000

662. Life insurance is primarily a / an

A. investment tool
B. financial security tool
C. tax saving tool
D. None of the above

663. Bringing a policy, which has lapsed, back to force is called ___________
A. Recovery
B. Renewal
C. Revival
D. Relapse

664. Which of the following is a characteristic of an ordinary, life policy?

A. It is the most expensive form of cash value insurance.
 B. It matures at age 65.
C. It has an increasing cash value and decreasing risk amount.
D. Both the cash value and amount at risk increase annually.

665. Which of the following statements concerning yearly renewable term is correct?
A. The insurance company may experience some adverse selection at renewal time.
B. The premiums do not increase from year to year.
C. Evidence of insurability must be furnished at the time of each renewal.
D. The insured can renew the policy each year by completing a medical exam.

666. Amita does not own health insurance. For th,e past two weeks, she has been experiencing sharp abdominal
pain. Given her condition, she would like to purchase health insurance. When higher-than average risks (like
Amita) are insured at average premiums, losses are higher than anticipated. What is this problem called?
A. Adverse selection
B. Morale hazard
C. Speculation
D. Moral hazard

667. Which of the following statements is (are) true with respect to endorsements and riders?
Endorsements and riders are used to amend provisions of insurance contracts.
If the endorsement or rider conflicts with terms in the underlying contract, the endorsement or rider takes
precedence unless it conflicts with the law.
A. I onl y
B. Both I and II
C. Neither I nor II
D. II only

668. Premium paid to Life Insurance for Value Additions such as Critical Illness Rider is eligible for deduction
under which section of the Income Tax Act, 1961.
A. Sec 80 C upto a Maximum of Rs. 1 Lakh.
B. Sec 80 C without any Maximum lirnit
C. Sec 80 D upto a Maximum of Rs.15000
D. Sec 80 D without any Maximum limit
E. None of the above

669. Ms. Kavita has an Endowment Life Insurance Policy where she has duly paid the premiums, she is
in urgent needs of funds which she doesn't want to repay back in order to marry off her only daughter Amita. As
a Financial Planner advise her the maximum amount she can avail on the said policy on its due surrender.
Date of commencement — 5th October, 1990
Date of last premium — 5th April, 2000
Date of birth — 1st May, 1965
Mode of premium payment - Half Yearly
Premium — Rs. 20 per annum for Rs. 1000 sum assured § Plan — Endowment with profit —
Term 25 years Sum assured — Rs. 1, 20,000
Bonus accrued from 31st March 1991 to 31st March 2000 is Rs 70 per Rs. 1,000 sum assured
Accidental benefit — Rs.2 per annum for Rs. 1000 sum assured
S.V. factor — 75% of Accumulated Value
A. Rs. 24000
B. Rs. 80,810
 C. Rs. 80,100
D. None of the above

670. LIC Premium Table depicts the following data for a certain policy in which your client Mr. Mohan is
interested Tabular premium: Rs. 33.10 per Rs. 1000 sum assured.
Rs. 2 less for yearly mode.
Re. 1 less for half yearly mode.
Rs. 3 less for sum assured of Rs. 1,00,000 and above.
Double accident is allowed up to a maximum of Rs. 10 Lakhs sum assured on payment of Re. 1
per 1000 sum assured. As a Financial Planner calculate the yearly premium for Rs. 15 Lakhs sum
assured with occupation extra of Rs. 4 per thousand sums assured
A. Rs. 49,150
B. Rs. 48,150
C. Rs. 48,650
D. Rs. 52,350
E. None of the above

671. Rohan, 30 years and married, works for a firm, which provides him with medical cover. He already has his
own house and saving of Rs. 42 lakhs, which are well invested. In the next 20 Years he will be able to save up
enough to fund his retirement and his children's education. Which of the following would be the most important
insurance for him?
A. Property Insurance
B. Temporary total disability
C. Life cover
D. Medical Cover

672. In case the policy owner and life assured under a life insurance policy are different, then the death claim
would be payable to
A. The spouse of the life assured
B. The mother of Life assured
C. The father of Life assured
D. The person nominated under the policy by the life assured

673. Riders on life insurance policy are

A. Available free of cost under certain policies
B. Additional benefits that can be purchased
C. In built provision with all policies
D. all of the above

674. Old age security can be provided by

A. Self through individual pension schemes
B. Employer through occupational pension schemes
C. Government as a social security tool
D. Any of the above

675. Loans under policies are granted

A. Up to the twice sum assured
B. Within the surrender value of the policy
C. Up to the full sum assured
D. Up to 75% of sum assured
676. If a life insured has died a few days before date of maturity, but after signing discharge form, to who
should the claim be paid?
A. Nominee
B. Surviving heirs
C. The policyholder's bank account
D. Any of the three above

677. One among the following Life insurance is comparable to the “Property and Casualty insurance” that is
_________
A. Money back assurance
B. Endowment assurance
C. Term life assurance
D. Variable Life assurance

678. Mortgage redemption policies are example of

A. Constant term assurance
B. Decreasing term assurance
C. Whole life assurance
D. Constant term assurance

679. Participating policies are those where __________

A. Both insurer and insured participates in each other's loss
B. Insured participates in running of insurance company
C. Insured participates in surplus of insurance company
D. Insurer participates in loss of insured

680. The maximum benefit per adult male/female per year under the Jan Arogya Bima Policy is
A. Rs.7500
B. Rs . 5000
C. Rs . 8000
D. Rs . 4000

681. Which one of the following statements is correct?

A. Riders provide supplementary benefits to the basic plan
B. Some riders are allowed only after the underwriters approval
C. Both the statements above are correct
D. Both the statements above are wrong.

682. Under joint life endowment policies insurance coverage can be up to

A. Death of second life assured
B. Death os first life assured
C. Death of both of the life assured
D. None of the above

683. Term insurance provides for payment of capital sum assured in case of
A. Death of the life assured before the end of the term
B. Survival of the life assured till the end of term only
C. Death of nominee before the end of terms
 D. Death of Life assured or on survival till the end of the term

684. Mr. Rohan will retire 3 months from now on completing 60 years. His 2 sons are very well off
residing abroad (d) He inherited a flat where he resides with Mrs. Rohan, both are in good health.
Liabilities are insignificant and post-retirement benefits are substantial. The flat is well decorated with
valuable moveable and immovable items. He owns a car purchased last year. He does not have any
insurance cover except for the car, as of now. Which amongst the following cover is relevant?
A. Term Insurance
B. Household Insurance
C. Endowment assurance
D. Money Back

685. An increasing term insurance means

A. Only the premium goes on increasing
B. Both the premium and sum assured increase
C. The sum assured increases at pre specified intervals
D. None of the above

686. Which of the following statement is true?

A. Male and female longevity profiles are just about the same
B. Males enjoy better longevity than females
C. Longevity profile of sexes do not follow any pattern
D. Females have greater life expectancy than males

687. In relation to life assurance, identify the incorrect statement amongst the following:
A. A joint life policy is payable upon the death of the first of two or more lives insured under
the single contract
B. A last survivor policy is payable upon the death of the last of two or more lives insured under the
single contract
C. In a renewable term insurance, the policy owner/insured would not be permitted to renew the
policy if he or she had contracted a terminal disease prior to the renewal date.
D. With a level premium policy, level premium in excess of the policy's share of death claims in
the early years of the contract are accumulated at interest in a reserve.

688. State which of the following statements is correct?

A. In ULIPs, the premium will be invested as per the offer price
B. The offer price will always be higher than the bid price
C. Both the above statements are correct
D. Both the above statements are wrong

689. Under a deferred annuity, the purchaser can pay the purchase price as
A. Single premium only
B. By installments only
C. In any way as stated in (a) & (b) above
D. None of the above

690. An annuity that makes lifetime payments with the first payment made after one month from the date of
purchase is termed as an
A. Immediate Life Annuity
B. Annuity Due
 C. Annuity Certain
D. None of the above

691. All of the following statements describe the functions of a life annuity except:
A. Because of the interest factor, an annuitant is assured of receiving back more than he or she paid in
B. The annuitant is assured that he or she cannot outlive the length of time of the annuity payments
C. The emphasis is on the Liquidation of the fund as opposed to its growth
D. The older the annuitant is when he or she receives the first annuity payment; the greater will be the amount
of each payment.

692. Which of the following benefit is not derived from a Term insurance policy?
A. Convertibility option
B. Surrender value
C. Higher cover
D. Lower premium

693. Mortgage redemption insurance illustrates

A. Increasing benefit term insurance
B. Level benefit term insurance with stepped up premium
C. Level benefit term insurance with level premium
D. Decreasing benefit term insurance

694. A young unmarried individual (aged 20-23 years) with no dependent should ideally opt for which of the
following insurance first.
A. Property insurance
B. Health insurance
C. Life insurance
D. None of the above

695. Mr. and Mrs. Sohan have Mr. Sohan's mother staying with them, who is entirely dependent on them. Mrs.
Sohan is a housewife. As an insurance advisor, you would suggest them to take insurance cover for
A. Mrs. Sohan because in her absence, who would look after her mother
B. Mr. Sohan's mother because Mr. and Mrs. Sohan have to support her for life
C. Mr. Sohan because he runs the household
D. None of the above

696. The endowment policy is characterized by

A. Sum assured being payable either at death or at end of the policy, whichever is earlier
B. Return of premiums at the end of the policy.
C. Sum assured being payable at the end of the premium paying term
D. Return of premiums plus bonus at the end of the policy or on death

697. State which of the following statements is correct?

A. In ULIPs, riders can be availed of
B. In ULIPs, the riders will be based on the basis SA and not NAVs
C. Both the above statements are correct
D. Both the above statements are wrong

698. State which of the following statement is True

Statement A: Term insurance provides protection on insured lives for a selected period only Statement B:
Premiums payable under term insurances are low because nothing is payable to the policyholder at the
end of the term, if he survives.
A. Both Statements A & B are True
B. Both Statements A & B are False
C. Only Statement A is True
D. Only Statement B is True

699. To get a high risk cover at a low premium, without worrying for inflation, the best suitable
life insurance policy would be
A. Decreasing term insurance
B. Level premium term insurance
C. Increasing benefit term insurance
D. None of the above

700. In a joint Life Policy, the policy comes to an end after the death of any one of the policy holder.
A. True
B. False
C. Partly True
D. Partly False

701. Rohan 36 years and married, works in multinational firm, which provides medical and related
cover. He is also able to accumulate sick leave. He has his own home and saving of 35 lakhs. What would
be the most relevant coverage suitable by him?
A. Life cover
B. Medical cover
C. Disability insurance
D. None of the above

702. State which of the following statement is True.

Statement A; Riders add to the basic benefits of a life policy
Statement B: Riders do not cost anything to the assured.
A. Statement A is True
B. Statement B is True
C. Both A & B are True
D. Both A & B are False

703. Under a joint Life Policy, the premium has to _____ be paid
A. Till any one of the insured dies or completion of the term whichever is earlier
B. Till any of the insured is alive
C. For full term irrespective of any other factor
D. None of the above

704. Under a joint life policy the claim amount is payable in the event of _______
A. Death of all the persons covered under the policy
B. Death of any one person covered under the policy
C. Death of more than one person/s covered under the policy
D. None of the above

705. In a joint life policy once a claim is paid then the claim amount is deducted from the maturity amount on
completion of the term.
 A. True
B. False
C. Partly True
D. Partly False

706. Which one of the following is a feature of the whole life policy?
A. You can get a loan which can be pre specified percentage of the surrender value.
B. It cannot lap even on default of Premium payment.
C. Premiums have to be paid throughout life compulsory.
D. None of the above

707. Sohan, 55 works for private firm and earns most of his salary as commission; he does not have benefits like
sick leave. He is single and already has Temporary Partial Disablement covers. What should his first priority
be?
A. Disability Insurance
B. Life cover
C. Health insurance
D. Property Insurance

708. For young adult, least important is

A. Accident cover
B. Critical illness cover
C. Basic life cover
D. Property cover

709. Mohan aged 22 years and unmarried works for a firm which provided him medical cover. His parents are
dependant on him and he has also taken a housing loan of Rs. 15 lacs to buy a flat. Which of the following
insurance would be the most suitable for him?
A. Life cover
B. Property Insurance
C. Temporary disablement
D. Medical cover

710. The main characteristic of a Deferred Annuity is that

A. The benefit payable is deferred till the end of the policy term
B. There is a pre-specified time lag between payment of premiums and payments of benefits.
C. The premium payments are spread over till the end of the policy.
D. Benefits and premiums payments run side by side

711. The core characteristic features of the whole life policy is

A. It covers all the needs of the insured during younger stage of life
B. It does not have a surrender value
C. Premium payment for guaranteed term is certain
D. Payment on benefits from insurer is certain

712. The most important reason for the perceived increase the longevity of adult people's life expectancy is
because of improvement in
A. Medical facilities and latest advancements in this field(d)
B. Migration of population
C. Child Mortality
 D. None of the above

713. Which amongst the following is a benefit that arises when a life insurance policy is purchased?
A. It serves as an immediate source of funds for the replacement of loan
B. It acts as collateral for loan
C. It frees properties from leasehold encumbrances
D. It creates an immediate estate if the insured dies

714. A convertible whole life policy may ideally meet the personal risk coverage needs of
A. person of above 40 age and sole earner of family
B. A young person stating his career and sole earner of family
C. A mature married person around 35 years of age
D. A retired person

715. One way of protecting the erosion in the value of a term insurance policy due to inflation, is by taking
an ____________
A. Increasing benefit term insurance
B. Level benefit constant term insurance
C. Decreasing benefits term insurance
D. None of the above

716. For replacement of mortgage (housing loan) or meeting hire purchase Liabilities a
_______________Policy would be the most appropriate.

A. Increasing benefit term insurance

B. Decreasing term insurance
C. Level benefit term insurance
D. None of the above

717. In decreasing term insurance policies, the death benefit payable will
A. Increase periodically over the policy term
B. Remain the same throughout the term of the policy
C. Decrease regularly till the end of the term
D. Be decided by the insurer every year

718. Mohan and Amita a retired couple opted for a joint life survivor annuity. Under this policy
A. The annuity will cease on the death of the eldest of the annuities
B. The annuity payment will cease on the death of any one of the annuitants
C. The annuity is payable as long as either one of them are alive
D. The annuity is payable as long as both of them are alive

719. Annuities are reverse of life insurance.

A. True
B. False
C. Pa r tl y Tr ue
D. Pa r tl y Fal s e

720. Sohan 22 is a young executive at the start of his career. He travels extensively by road in and
out of the city. He has to start a family in 5-6 years time. What kind of life insurance cover should
be suitable for him?
 A. Endowment insurance policy
B. Money back policy
C. Uni t - li nke d poli c y
D. Temporary insurance policy with convertibility and renew ability option

721. One way of protecting the erosion in the value of a term insurance policy is by taking an
A. Level benefit constant term insurance
B. Decreasing benefit term insurance
C. Increasing benefit term insurance
D. None of these

722. The conversion option in temporary assurance means that the assured can opt to convert the
term cover into say a whole life or endorsement policy. Under this, one will normally get the
A. Same sum assured benefit level in the changed policy
B. Increased sum assured level in the changed policy
C. Reduced sum assured level
D. None of these

723. Policy cost/conversion = 0.001, Interest allowed equivalent to after tax return =20%, annual
premium = Rs. 13,000, dividend or bonus = Rs. 23,000, death benefits = Rs. 20, 00,000, cash
surrender value at the end of current policy period = Rs. 6, 50,000, cash surrender value at the end
of previous policy year = Rs. 570000. What is policy cost per thousand?
A. 19.70
B. 44.66
C. 57.84
D. 122.51

724. Policy cost/conversion = 0.001, Interest allowed equivalent to after tax return =19%, annual
premium = Rs. 14,000, dividend or bonus = Rs. 22,000, death benefits = Rs: 25, 00,000, cash
surrender value at the end of current policy. period = Rs. 6, 00,000, cash surrender value at the end
of previous policy year = Rs. 580000. What is policy cost per thousand?
A. Rs. 19.70
B. Rs. 44.66
C. Rs. 57.84
D. Rs . 122. 51

725. Policy cost/conversion = 0.001, Interest allowed equivalent to after tax return =18%, annual
premium = Rs. 14,000, dividend or bonus = Rs. 21,000, death benefits = Rs. 30, 00,000, cash
surrender value at the end of current policy period = Rs. 5,90,000, cash surrender value at the end
of previous policy year = Rs. 550000. What is policy cost per thousand?
A. 19.70
B. 44.66
C. 22.62
D. 122.51