2018

BALIC IC 38 MOCK TEST

MOCK TEST 10
AGENCY TRAINING
Test 10

Multiple Choice
Identify the choice that best completes the statement or answers the question.

1. Which market areas do Micro Insurance product concentrate?

a. People with large families c. people employed with the government
b. people with low income d. people with high income

ANSWER: B

2. The competition for the business of life insurance is?

a. Non-life insurance c. House property
b. Small saving d. None of these three

ANSWER: D

3. State which of the following statement is correct?

a. Perils are avoidable c. Both the above statement are correct
b. Perils are not avoidable d. Both the above statement are wrong

ANSWER: B

4. Whether there is any plan which allows weekly premium payment?

a. Group Insurance c. Micro Insurance
b. Vehicle Insurance d. Health Insurance

ANSWER: C

5. Dikshit has expertise in calculating premium level of product. He shall be useful in

which department?
a. Actuary c. Risk Manager
b. Underwriter d. Loss Adjuster

ANSWER: A

6. What is the major reason for self-employed to take insurance?

a. Save tax c. High Return
b. Fluctuating income d. Protection

ANSWER: D

7. Which of the following statement is correct?

 a. Lung cancer is peril and smoking is a c. Both the statement is correct
hazard
b. Smoking is peril and lung cancer is d. Both the statement is incorrect
hazard

ANSWER: A

8. Lung cancer and smoking is considered?

a. Occupational Hazard c. Smoking is peril and lung cancer is
hazard
b. Death is certain d. Lung cancer is peril and lung cancer is
hazard

ANSWER: D

9. The consequences of risk which will affect specific individuals or local communities in
nature is called?
a. Pure risk c. Particular risk
b. Financial risk d. Physical Hazard

ANSWER: C

10. In whole life plan the policyholder's responsibility is to give disclosures at?
a. Beginning of the contract c. Revival stage
b. Throughout the contract d. Beginning of renewal

ANSWER: A

11. If found later that insurable interest is missing the contract is

a. Expired c. Void
b. Reviewed d. Invalid

ANSWER: D

12. Indemnity principle denotes

a. Insurance cannot be used for profit c. Insurance cannot be taken by
politicians
b. Insurance not to be taken by High Risk d. All the above
people

ANSWER: A
13. Generally insurance companies do not hold premium in case fraud or misrepresentation.
However due to which of U following circumstances the insurance can retain the
premium the policyholder?
a. Fraudulent claim c. Redressal procedure
b. Indisputability clause d. Pending decision from ombudsman

ANSWER: C

14. A contract exists between insurer and proposer when?

a. A proposal has been accepted by c. A policy document has been received
insurer by policyholder
b. A policy document has been stamped d. An insurer has made another proposal
by insurer

ANSWER: A

15. Saurabh has taken an endowment policy of 20 yrs. He has, premium for 10 yrs. policy is
in force. Can Saurabh take a loan?
a. Saurabh will not be granted a loan c. Loan can be given on certain
percentage of surrender value
b. No concept of loan in insurance policy d. Loans are granted only in term plans

ANSWER: C

16. In underwriting the economic value of the person is determined by?

a. Occupation of the person c. The income that he earns
b. Financial history of his family d. Human life value

ANSWER: D

17. Why ACR is needed?

a. To calculate premium c. To verify plan proposal
b. To calculate commission d. To help underwriter to assess risk

ANSWER: D

18. If a person has taken a Pure Endowment Policy, then what will be the death benefit if he
dies during term of policy?
a. No Death Benefit c. Both are correct
b. Sum Assured will be paid d. both are incorrect

ANSWER: A

19. Two people have the same policy Term, but one person pays more premium because?
 a. Married c. Health deterioration
b. Wife Younger d. Higher Age

ANSWER: D

20. At the time of maturity, quarter of the sum assured. What policy was in force?
a. Endowment c. Money back
b. Lien d. Surrender

ANSWER: C

21. If insured gets two advance payment in 5 yrs. and in mat gets rest of sum assured what
type of policy it is
a. Money back policy c. Term plan
b. Convertible plan d. Endowment plan

ANSWER: A

22. A customer while investing in to Recurring deposit or Cumulative deposit what are the
key factors which will matter?
a. Taxation c. interest rates
b. frequency of payment d. tenure

ANSWER: C

23. A person who has a temporary job loss where should he look for investing other than
FD?
a. Debt fund of MF c. Equities
b. Govt. securities d. Gold

ANSWER: A

24. If RBI increases the interest rates then what will be the effect 0 share prices?
a. Shares will be more attractive c. Fixed deposit will be more attractive
b. Shares will be less attractive d. Fixed deposit will be less attractive

ANSWER: B

25. Payment/investments in Kisan Vikas Patra under post office scheme is done by paying?
a. Regularly with no fixed term c. Lump sum for fixed period of time
b. Lump sum with no fixed term d. Regularly for fixed period of time

ANSWER: C
26. In a guaranteed annuity option of 5 years, the policy holder will get annuity till?
a. Entire life term c. Annuity only for 5 years
b. Till 5 years and continue till annuitant d. None of the above
lives

ANSWER: B

27. What are the Special features of Health plan?

a. Covers disease expenses c. covers hospitalization cost
b. Helps in Tax Benefits d. All of the above

ANSWER: D

28. A lump sum withdrawal allowed as commutation in pension is?

a. 1/3 of the accumulated fund c. 1/2 of the accumulated fund
b. 1/4 of the accumulated fund d. Full withdrawal is allowed

ANSWER: A

29. To avail the income tax benefit at investment stage is?

a. 10% of sum assured c. 30% of sum assured
b. 20% of sum assured d. 40% of sum assured

ANSWER: B

30. Mr. Raj is married and is father to 2 children. Which plan can he go for to cover his
whole family?
a. Health insurance c. Life insurance
b. Family floater d. Retirement

ANSWER: B

31. For his investment needs Ravi parked funds in equity. Returns from this investment can
be categorised as?
a. High risk c. Moderate risk
b. Low risk d. No risk

ANSWER: A

32. In which of the following case there is no defined retirement age?

a. Public sector employees c. Professional & businessmen
b. Pvt. sector employees d. All of above
 ANSWER: B

33. An agent has recommended an investment product with non-guaranteed benefits. The
benefit illustration passed to his client will therefore use assumed annual growth rates of?
a. 5% and 8% c. 6% and 8%
b. 5% and 10% d. 6% and 10%

ANSWER: D

34. Nandu, aged 32 yrs., has taken money back plan. He is a teacher. Nandu referred his
agent to Vithal who is also a teacher. The agent advised him to take money back plan as
he is of the same age. Vithal’s age is 33yrs. Is it the right advice? Why
a. Yes Nandu & Vithal are of same age c. Yes, both are teachers
b. No. Customer needs could be different d. No, there is age difference

ANSWER: B

35. Objective of fact-find do not include?

a. Identify needs c. Provide for anticipated changes
b. Gathering client data d. Surrendering existing policies for
selling new one

ANSWER: D

36. Persistency has increased from 82 % in previous year to 86 % this year. That means?
a. More lapsation c. Less lapsation
b. More attrition d. No profits

ANSWER: C

37. The best way to prove that the customer of a ULIP policy is given awareness about the
commission paid to the agent is?
a. Ask the insurer to give a policy c. From signed copy of benefit
endorsement letter illustration
b. From the facts details d. From ticked column of proposal form

ANSWER: C

38. Under which one of the following acts the maximum remuneration that can be given to
insurance agent stated?
a. Income tax act c. Insurance act 1938
b. Indian contract act d. IRDA act 1999

ANSWER: C
39. Under what circumstances can the surrender of a policy be recommended by agent?
a. Miss sold the policy by not matching c. Financial problem compelling to
needs reduce expenditure or reschedule it
b. Products not good value for d. one and all
money

ANSWER: D

40. Without submitting any form of claim, a life insurance policy holder received payments
of maturity. What type of policy he is holding?
a. ULIP c. Money Back
b. Term d. Health

ANSWER: C

41. A claim was paid in a policy and it was advertised in the newspaper as well. This
indicates that the policy was?
a. It was assigned c. It was lost
b. It was paid up d. It was surrendered

ANSWER: C

42. What are the consequences of paying a fraudulent claim?

a. Insurers profits affected which impacts c. Temptation to continue the practice
rise in premium
b. Premium pool distorted d. All of above

ANSWER: D

43. Who is the regulatory body of money laundering in insurance sector?

a. SEBI c. IRDA
b. RBI d. TRAI

ANSWER: C

44. To ensure that the premiums are paid out of a legitimate source of funds cash is accepted
up to?
a. 50,000 c. 100,000
b. 99,990 d. Without any limit

ANSWER: A
45. Who controls and regulate the rates advantage, term and condition that may be offered
by insurers in respect of general insurance business?
a. Insurance regulatory an development c. Tariff Advisory Committee
authority
b. Reserve Bank of India d. Insurance Institute the India

ANSWER: C

46. Insurance companies are required to honour the awards passed by the Insurance
Ombudsman?
a. 15 days c. 20 days
b. 10 days d. 3 days

ANSWER: A

47. What is the period of award passed to the customer decided by ombudsman?
a. 2months c. 5 months
b. 3 months d. 6 months

ANSWER: B

48. The ombudsman power is above?

a. 50 lac c. 25 lac
b. 30 lac d. 20 lac

ANSWER: D

49. How many ombudsman offices are located in India?

a. 10 c. 14
b. 12 d. 15

ANSWER: B

50. Insured can contact to seek the resolution of grievances they have against insurer to
IRDA through?
a. complaintgov.irdi.in c. irda.complaintsgovt.in
b. insurancecomplaint©irda.ifl d. complaintsirda.govt.in

ANSWER: D