Deck 10: Life Assurance Products and Their Features

Question 1

All of the Following Statements are False, with Respect to Unit-Linked Insurance Plans (U.L.I.P.s), Except:

A)Policy-Holder's Benefits or Returns depend on the Assumptions and Discretion of the Life Assurance Company.
B)Investment-Risk is borne by the Insurer.
C)Unit-Linked Insurance Plans (U.L.I.P.s) are Transperant with Regard to their Term- Component, Expenses- Component, and Savings- Component.
D)Unit-Linked Insurance Plans (U.L.I.P.s) are Bundled Products.

Answer 1

Unit-Linked Insurance Plans (U.L.I.P.s) are Transperant with Regard to their Term- Component, Expenses- Component, and Savings- Component.

Question 2

Suggest a Non-Traditional Life Assurance Product.

A)Term Assurance
B)Variable Life Assurance
C)Whole Life Assurance
D)Endowment Assurance

Answer 2

Variable Life Assurance

Question 3

Non-Traditional Life Assurance Products satisfy a Certain Motive of Many Investors. Select the Most Appropriate Option.

A)Guaranteed Benefits
B)Fixed Returns
C)Wealth-Accumulation
D)Protection of Capital

Answer 3

Wealth-Accumulation

Question 4

Which One of the Following, is Not a Limitation of Traditional Life Assurance Products? Choose the Most Appropriate Option.

A)Difficult to Ascertain the Surrender-Values, At Any Given Point of Time.
B)In-Sufficient Coverage.
C)Cash-Value-Component, Not Well-Defined.
D)Limited Rate-of-Return.

Question 5

Choose the Correct Statement.

A)In Variable Life Assurance, the Monthly or Yearly Premiums can vary, as per the Perference of the Insured.
B)Variable Life Assurance is a Permanent Life Assurance.
C)In a Variable Life Assurance Policy, the Investment-Risk is Borne by the Insurer.
D)The Policy provides Fixed Guaranteed Returns, which are Specified at the Beginning, it-self.

Question 6

Name the Two Areas, Related to Non-Traditional Insurance-Products, where, the Customers can exercise their Choice.

A)Altering the Premium and Benefit-Structure, and Choose: How to Invest the Premium- Proceeds.
B)Alter the Rate-of- Return, and Choose: When to Invest the Premium-Proceeds.
C)Alter the Rate-of- Return, and Choose: How to Invest the Premium-Proceeds.
D)Alter the Rate-of-Return and Premium-Structure.

Question 7

Where was, Universal Life Assurance, introduced First?

A)United States of America (U.S.A.)
B)England
C)France
D)Germany

Question 8

Expand the Term: U.L.I.P.

A)Unit-Less Insurance Policy
B)Unit-Linked Investment Policy
C)Unit-Linked Insurance Policy
D)Union-Linked Insurance Policy

Question 9

What Does, Un-Bundling of Life Assurance Products, refers to?

A)Correlation of Life Assurance Products with Bonds.
B)Correlation of Life Assurance Products with Equities.
C)Amalgamation of Protection-Element and Savings-Element.
D)Separation of the Protection-Element and Savings-Element.

Question 10

A Policy is effected under Married Women's Property (M.W.P.) Act. If the Policy-Holder does not appoint a Special Trustee to receive and administer the Benefits under the Policy, the Sum, secured under the Policy, becomes Payable to --.

A)Next of Kin
B)Official Trustee of the State
C)Insurer
D)Insured

Question 11

Which Section of Married Women's Property (M.W.P.) Act, provides for Security of Benefits under a Life Assurance Policy, to the Wife and Children?

A)Section 38
B)Section 39
C)Section 6
D)Section 45

Question 12

Mortgage-Redemption-Insurance (M.R.I.) provides --- Protection, for Home-Loan Borrowers.

A)Social
B)Financial
C)Physical
D)Tangible

Question 13

Key-Man Insurance is a Term Assurance Policy, where, the Sum-Assured is Linked to --.

A)Business-Profitability of the Company
B)Number of Employees
C)Chief Executive Officer (C.E.O.)'s Personal Income
D)Personal Incomes of All the Employees

Question 14

Who is a Key-Man?

A)Person, who has Key to the Office-Lock.
B)Person, Critical to the Business-Operations.
C)Person, Who Left the Business.
D)Person, Willing to Join the Business.

Question 15

Identify the Benefits of taking-out a Key-Man Insurance Policy.

A)Off-Set Business Start- Up Costs.
B)Off-Set the Business- Continuity-Costs.
C)Off-Set the Business- Recovery-Costs.
D)Promote the Worker- Harmony.

Question 16

Categorise Mortgage-Redemption-Insurance, Under One of the Following Options.

A)Increasing, Term Assurance
B)Decreasing, Term Assurance
C)Variable Life Assurance
D)Universal Life Assurance

Question 17

In Case of a Policy, effected under Married Women's Property (M.W.P.) Act, the Policy-Monies shall be Payable to --.

A)Trustee
B)Appointee
C)Assignee
D)Nominee

Question 18

Select the Factor, that is Linked to the Sum-Assured under a Key-Man Insurance Policy.

A)Key-Man's Income
B)Business-Profitability
C)Business-History
D)Inflation-Index

Question 19

Select the Loss, covered under Key-Man Insurance.

A)Property-Theft
B)Losses, Related to the Extended Period, when a Key-Person is Unable to Work.
C)Losses, Caused Due to Errors and Omissions.
D)General Liability

Question 20

What is the Tax-Treatment offered under Key-Man Insurance?

A)Policy-Returns are Tax- Exempt.
B)Premiums are Treated as Business-Expense, and are Tax-Exempt.
C)Premiums are Taxable.
D)Policy-Returns are Heavily Taxable

Question 21

If You need to purchase a Key-Man Insurance Policy, then, What is the Information, that is going to be sought by the Insurer, to assess the Application?

A)Business' Audited Financial Statements and Filed Income-Tax (I.T.) Returns
B)Salary of the Chief Executive Officer (C.E.O.)
C)Name of the Chief Executive Officer (C.E.O.)
D)Names of All the Employees

Question 22

Expand the Term: M.R.I.

A)Most Reliable Insurance
B)Mortgage-Redemption- Insurance
C)Money-Redemption- Insurance
D)Money Reliable Insurance

Question 23

Why, Mortgage-Redemption-Insurance (M.R.I.) referred to as 'Decreasing, Term Assurance'?

A)Cover remains Constant throughout the Policy- Period.
B)Cover decreases along with the Policy-Term.
C)Cover increases along with the Policy-Term.
D)Premium increases with the Policy-Term.

Question 24

What will be Looked At, in order to determine the Sum-Assured, under Key-Man Insurance?

A)Key-Man's Current Financial Statements.
B)Key-Man's Past Financial Statements.
C)Audited Financial Statements of the Business and Income- Tax (I.T.) Returns.
D)Income-Tax (I.T.) Returns of the Key-Man.

Question 25

Which of the Following, are the Components, used to calculate the Gross Premium?
I: Net Premium.
II: Expense-Loading.
III: Loading for Contingencies.
IV: Bonus-Loading.

A)I and II.
B)II and III.
C)I and IV.
D)I, II, III, and IV.