IC02 Mock Test Sample 8
These MCQs cover key concepts of IC02 – Practice of Life Insurance, focusing on policy assignment, premium calculation, and legal provisions. They test understanding of loadings, revival schemes, duplicate policy costs, and types of insurance like mortgage (decreasing term). Important legal aspects include MWP Act protection, forfeiture rules, and suicide clause. Core insurance principles such as risk, insurability, and claim investigation timelines are included. Questions also cover policy document structure, ombudsman details, and keyman insurance. Additional topics include non-forfeiture options, gratuity laws, and actuarial valuation, helping build a strong foundation in insurance operations, regulations, and financial risk assessment.
1. In assignment, if the policy is assigned to a minor then ________ has to be appointed.
a) An appointee
b) An assignor
c) A guardian
d) A legal heir
2. The term used to refer an increase in Net or Pure Premium is:
a) Bonus
b) Loadings
c) Office premium
d) Risk premium
3. Special revival scheme is available if policy has not lapsed for more than:
a) 1 year
b) 2 years
c) 3 years
d) 4 years
4. Who bears the cost of issuing a duplicate policy?
a) Insurer
b) Policyholder
c) Insurance agent
d) Insured
5. Mortgage insurance is a type of:
a) Unit linked
b) Whole life
c) Increasing term
d) Decreasing term
6. MWP Act 1874 is under which section of Insurance Act 1938?
a) 38
b) 39
c) 21
d) 9
7. Under MWP Act, which is TRUE?
a) Creditors have first claim
b) Creditors have no claim
c) Creditors have residual claim
d) Tax authorities have claim
8. To avoid forfeiture clause, premiums must be paid for at least:
a) 1 year
b) 2 years
c) 3 years
d) 4 years
9. Which statements are TRUE?
a) Certain events cannot be insured
b) Insurance is relevant when economic loss possible
c) Insurance compensates careless lifestyle
d) Both a and b
10. Claim investigations must be completed within:
a) 1 month
b) 3 months
c) 6 months
d) 9 months
11. Risk of death is ______ as age ______.
a) Higher, decreases
b) Lower, increases
c) Lower, decreases
d) Higher, increases
12. Ombudsman address is mentioned in:
a) Terms & conditions
b) Preamble
c) Information statement
d) Schedule
13. Policy document is:
a) Opening paragraph
b) Request for alteration
c) Request for duplicate
d) Evidence of contract
14. Life insurance contract is also known as:
a) Commercial contract
b) Indemnity contract
c) Investment contract
d) Speculative contract
15. In keyman insurance, who is insured?
a) Proprietor
b) Any employee
c) Key employee affecting profits
d) None
16. Good non-forfeiture option is:
a) Grace period
b) Surrender value
c) Notional credit
d) Level premium
17. OR stands for:
a) Oral rehydration
b) Once renewed
c) Ordinary rates
d) Ordinary renewal
18. Suicide clause – insurer pays after:
a) 3 months
b) 6 months
c) Not covered
d) 1 year
19. Gratuity Act applies if employees exceed:
a) 5
b) 10
c) 15
d) 25
20. Valuation in life insurance is:
a) Profit calculation
b) Net premium calculation
c) Bonus valuation
d) Value of existing policies
