IC02 Mock Test Sample 5
These MCQs cover advanced concepts of IC02 – Practice of Life Insurance, focusing on underwriting, claims, annuities, and policy servicing. They test understanding of underwriting principles, bonus distribution, and annuity types, along with regulatory aspects like claim settlement delays and turnaround time (TAT). Practical scenarios include waiver of premium rider, free-look period, and surrender value. Questions also assess knowledge of insurable interest, mortality tables, ULIP features, and policy revival rules. Real-life cases such as early death claims and money-back policies are included. Overall, the set strengthens conceptual clarity on risk assessment, policyholder rights, and operational practices in life insurance.
1. Which of the following statement(s) is/are correct?
- Underwriting ensures all insured share the same risk
- Bonus vested is same for all policies
- In an immediate annuity policy…
a) All statements are correct
b) All statements are incorrect
c) Statement 1 and 2 are correct
d) Statement 2 and 3 are correct
2. Interest at ______ above savings bank rate is payable for delay in claim settlement.
a) 1%
b) 2%
c) 2.5%
d) 3%
3. Waiver of Premium Rider case (parents died): insurer will
a) Close policy
b) Pay sum assured to guardians
c) Ask guardians to pay premium
d) Continue policy and pay premiums
4. If policyholder is not satisfied after purchase, what can he do?
a) No option
b) Complaint to agent
c) Complaint to ombudsman
d) Return policy within 15 days
5. Pick the true statement
a) HLV based on dependent income portion
b) Smoking is a peril
c) Whole life provides lifetime cover
d) All of the above
6. Which statements about debt instruments are true?
a) Has interest rate
b) Has maturity period
c) Represents amount borrowed
d) All are correct
7. Which statements are correct?
A: Lost policy may be assigned
B: After survival benefits, policy has no value
C: Policy should be kept after maturity
a) Only A
b) Only B
c) Only C
d) Both A and C
8. What is Surrender Value?
a) Amount on foreclosing policy
b) Sum assured at maturity
c) Amount after maturity
d) Cash value on surrender
9. Special revival scheme available if policy not lapsed more than:
a) 1 year
b) 2 years
c) 3 years
d) 4 years
e) 5 years
10. Value of investment is:
a) NAV × Units
b) Units × NAV
c) Market value × NAV
d) Market value ÷ Units
e) None
11. IRDA TAT for processing policy decisions is:
a) 5 days
b) 10 days
c) 15 days
d) 20 days
e) 25 days
12. Insurable interest exists in:
a) Husband–wife
b) Employer–employee
c) Business partners
d) Lender–borrower
e) All of the above
13. Money-back policy death benefit (after survival benefits):
a) Deduct charges and pay
b) Continue premium
c) Full sum assured paid
d) Only last installment
e) Sum assured minus installments
14. ______ are used to calculate premiums
a) Mortality tables
b) Actuarial valuations
c) Underwriter valuation
d) Actuarial surplus
e) None
15. Free look refund allowed if:
a) Terms differ from sales
b) Policy not suitable
c) Dissatisfied with service
d) All of the above
e) None
16. Notional life fund share is due to:
a) Higher early premiums
b) Survivorship premium
c) Interest earned
d) Only 1 and 2
e) All 1, 2 and 3
17. 50% pension to spouse indicates:
a) Joint life annuity
b) Fixed annuity
c) Life annuity
d) Increasing annuity
e) Decreasing annuity
18. Death within ~2 years is:
a) Early claim
b) Non-early claim
c) Special claim
d) Normal claim
e) Non-admissible
19. ULIP non-payment, units reduced for charges is called:
a) Premium holiday
b) Premium block
c) Premium deterioration
d) Premium adjustment
e) Premium reduction
20. Mr. Rohit eligible as LIC agent because:
a) Not minor
b) Passed 12th
c) Sound mind
d) No criminal record
e) All of the above
