Life Assurance- Product Knowledge Flashcards
What is life cover?
Life cover is a type of insurance that pays a sum of money to beneficiaries upon the insured person’s death.
True or False: Life cover only provides benefits if the insured dies from natural causes.
False
What are the primary benefits of having life cover?
The primary benefits include financial security for dependents, covering debts, and funeral expenses.
Fill in the blank: Life cover is often referred to as __________ insurance.
death
What factors affect the cost of life cover?
Factors include age, health status, lifestyle, occupation, and the amount of coverage needed.
True or False: Life cover can only be purchased by individuals under 50 years of age.
False
What is the maximum coverage amount typically available for life cover?
The maximum coverage amount varies by provider but can be up to several million dollars.
What is the purpose of a beneficiary in a life cover policy?
The beneficiary is the person or entity designated to receive the death benefit from the policy.
Multiple Choice: Which of the following is NOT a type of life cover? A) Term Life B) Whole Life C) Health Insurance
C) Health Insurance
What is term life insurance?
Term life insurance provides coverage for a specific period, after which the policy expires.
True or False: Whole life insurance includes a savings component.
True
Fill in the blank: Life cover provides peace of mind that your loved ones will be __________ in the event of your death.
financially secure
What is the general process for applying for life cover?
The process typically involves completing an application, providing health information, and possibly undergoing a medical examination.
True or False: Life cover premiums can increase over time.
True
What is a pre-existing condition in the context of life cover?
A pre-existing condition is a health issue that existed before the purchase of the life cover policy.
Multiple Choice: What is a common feature of life cover policies? A) Guaranteed acceptance B) Flexible payment options C) Both A and B
C) Both A and B
What happens to the life cover policy if the insured person stops paying premiums?
The policy may lapse, meaning coverage ends and no benefits will be paid out.
True or False: Life cover can be customized based on individual needs.
True
What is the role of an insurance adviser in obtaining life cover?
An insurance adviser helps individuals understand their options and choose the right life cover for their needs.
Fill in the blank: __________ is an important aspect to consider when choosing life cover.
Affordability
What does ‘underwriting’ refer to in life cover?
Underwriting is the process by which insurers assess risk and determine premium rates for life cover.
True or False: Life cover can be used as collateral for loans.
True
What is a ‘rider’ in the context of life insurance?
A rider is an additional benefit that can be added to a life insurance policy for extra coverage.
Multiple Choice: Which of the following can be a rider? A) Accidental death benefit B) Disability income C) Both A and B
C) Both A and B
What is the typical waiting period for a life cover policy to become effective?
The waiting period can vary but is often immediate upon policy approval.
True or False: You can have multiple life cover policies at the same time.
True
What is a ‘contestability period’ in life insurance?
The contestability period is a time frame during which the insurer can dispute a claim based on misrepresentation.
Fill in the blank: Life cover is an essential part of __________ planning.
financial
What is the difference between a ‘beneficiary’ and an ‘estate’ in life cover?
A beneficiary is a designated person to receive benefits, while an estate refers to all assets and liabilities of the deceased.
True or False: Life cover can help pay off mortgages.
True
What is the significance of reviewing your life cover policy regularly?
Regular reviews ensure that coverage meets current needs and reflects any life changes.
Multiple Choice: Which of the following is a common reason to increase life cover? A) Birth of a child B) Change of job C) Vacation
A) Birth of a child
What does it mean if a policy is ‘permanent’?
A permanent policy provides lifelong coverage as long as premiums are paid.
Fill in the blank: Life cover can provide __________ for final expenses.
funds
True or False: Life cover policies are the same for everyone.
False
What is the impact of lifestyle choices on life cover premiums?
Unhealthy lifestyle choices can lead to higher premiums due to increased risk.
What is ‘term conversion’ in life insurance?
Term conversion allows the policyholder to convert a term policy into a permanent policy without additional underwriting.
Multiple Choice: Which term refers to the amount the policyholder pays for coverage? A) Premium B) Benefit C) Deductible
A) Premium
What is the purpose of a ‘free look’ period in life insurance?
A free look period allows the policyholder to review and cancel the policy within a certain time frame without penalty.
True or False: Life cover benefits are taxable to the beneficiaries.
False
Fill in the blank: __________ is a common method used to determine the amount of life cover needed.
Needs analysis
What is the significance of premium payment frequency?
The frequency of premium payments can affect the total cost and budgeting for the policyholder.
Multiple Choice: Which of the following statements about life cover is true? A) It is only for those with dependents B) It can be beneficial for anyone C) It is not necessary for young individuals
B) It can be beneficial for anyone
