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Category: IC23 APPLICATIONS OF LIFE INSURANCE – 05

IC23 APPLICATIONS OF LIFE INSURANCE – 05

Que. 1 : Q1) Which policies means that before the end of the specified conversion period, one may choose to convert the term policy to a whole life or endowment policy, even if the health of the insured changes?

   1.  a) Whole life policies

   2.  b) Term life insurance

   3.  c) Endowment Insurance

   4.  d) Convertible term policies

Que. 2 : Q2) Which model includes enterprises owned by society and government together and Programmes are operated on a non – profit basis?

   1.  a) Non-profit model

   2.  b) Al-mudaraba Model

   3.  c) Al-wakala Model

   4.  d) None of the above

Que. 3 : Q3) Which involves accepting the loss when it occurs and it a good strategy only when it is impossible to transfer the risk or based on an evaluation of the economic loss exposure, it is determined that the diminutive value placed on the risk can be safely absorbed?

   1.  a) Risk avoidance

   2.  b) Risk retention

   3.  c) Risk transfer

   4.  d) Risk avoidance

Que. 4 : Q4) What means gambling, a prohibited activity, as it is zero-sum game just transferring wealth and not creating new wealth. E.g. term life products have small premiums with the guarantee of a larger benefit on death?

   1.  a) Riba

   2.  b) Gharar

   3.  c) Haram

   4.  d) Maysir

Que. 5 : Q5) Under which clause the definition of what constitutes a loss will vary according to the type of reinsurance and the nature of original business reinsured and this clause specifies the same?

   1.  a) Ultimate Net loss clause

   2.  b) Reinstatement clause

   3.  c) Net retained Lines clause

   4.  d) Loss occurrence definition clause