Insurance - Study Mode

[#101] Which of the following statements is correct?
Correct Answer

(B) In universal life plan, policyholder can vary payments of premium
(F) The policy document has to be signed by a competent authority and should be stamped according to the Indian Stamp Act
(I) Risk prevention aims at avoidance of loss through insurance
(O) Insurance is risk transfer through risk pooling
(T) Selling is both an art and a science
(U) There is an Ombudsman for defined territorial limits
(Y) In group insurance, a single policy is issued covering many persons
(_) An insurance agent works according to his schedule
(a) Higher premium will give the beneficiary higher benefits at the time of claim

Explanation

Solution: Universal life can provide you with a variety of different payment options, including a flexibility of changing your death benefits, as well as the potential to accumulate cash value over time. Hence, option (2) is correct.

[#102] Which of the following is the most appropriate explanation for the fact that young people are charged lesser life insurance premium as compared to old people?
Correct Answer

(C) Mortality is related to age

Explanation

Solution: Mortality is related to age and hence, young people who are less likely to die are charged lower premiums as compared to old people.

[#103] Which is true of Current Money method of dividend payment?
Correct Answer

(D) All of the above

Explanation

Solution: All the above are true regarding current money method of dividend payment. Returns depend on when the investment was made, Different investment blocks get different returns and It is also called segmented or investment block method.

[#104] In ULIPs, the result of policy allocation charge would be that _________ amount would be allocated for investment in units.
Correct Answer

(B) Less

Explanation

Solution: In ULIPs, the result of policy allocation charge would be that less amount would be allocated for investment in units.

[#105] In which type of products were protection and saving elements separated?
Correct Answer

(B) Non-traditional plans

Explanation

Solution: In non-traditional plans, protection and saving elements were separated.