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M9 Insurance Mock Paper > M9 Mock Paper 1 > Flashcards

M9 Mock Paper 1 Flashcards

1
Q

The jurisdiction of the financial industry disputes resolution center in adjudicating dispute between insureds and insurance companies is up to:

A

$100000,

That means any issues can will be settled up to only 100000

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2
Q

Who determines premium rates of life insurance policies?

A

Underwriters

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3
Q

Riders are known as…

A

Supplementary benefits

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4
Q

This is NOT one of the common exclusion in a critical illness rider

A

Injury sustained while traveling in public transport

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5
Q

Statement “the fund will invest in investment grade government and corporate securities and is expected to outperform cash deposits in the medium term” is a typical example of?

A

Bond funds.

Key word is “securities”

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6
Q

What investment linked sub funds contains a pre set mix of sub funds?

A

Managed portfolios

Key word: preset mixed of sub funds

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7
Q

Under what type of annuity? Does the benefit payment not stop until the annuitant dies?

A

Life annuity.

Key is no time limit except death

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8
Q

What kind of annuity is hedged against inflation?

A

Increasing rate annuity

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9
Q

All mistakes made in the proposal form must be:

A

Countersigned by client

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10
Q

What document insurer request from claimant to ensure they are the proper claimants as defined in the insurance act: cap 142

A

Statutory declaration

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11
Q

What kind of gains is exempted from Income tax in Sg?

A

Capital gains.

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12
Q

Family history helps the insurer to assess.

A

Medical risk

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13
Q

What are capital gains

A

Profits from sale of property or investments

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14
Q

An agency created based on mutual conduct of parties suggest certain intention. This is a / an

A

Implied agency.

Key word: agents of jurisdiction to make legally binding contracts on behalf of co.

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15
Q

Guaranteed insurability option rider makes the person to be able to purchase additional insurance coverage

A

At a specific time without proof of insurability

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16
Q

An insurance intermediary is someone who can be the agent of

A

Both the insurer and insured

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17
Q

What type of fund is typically

Closed end fund
Fixed maturity date

A

Capital guaranteed fund

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18
Q

Independent assessment of financial capacity or creditworthiness of life insurers is provided by:

A

Independent financial advisors

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19
Q

To cover the risk of outliving ones financial resources , one should buy

A

Annuity product

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20
Q

To make medisave contributions, a self employed’ yearly net income is

A

6000 which is 500 per month

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21
Q

Insurers are allowed to keep their internal governing policies to themselves as

A

It is too technical for lay person to understand.

So a lay person has the right to know if he understands.

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22
Q

Unit trust or similar investments + some insurance protection

A

Investment linked life insurance policy

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23
Q

With regard to annual bonus allocation

A

The same bonuses may be allocated for a good year and a bad year performance

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24
Q

Investment linked funds which ploughs back investment income into the funds have a…

A

Accumulation structure

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25
Q

Loading on insurance policies is to cover

A

Insurers business expenses and profit margins

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26
Q

Insurer may increase the insurance coverage charges under an investment linked life insurance policy when….

A

There has been a general and sustained worsening of claims experience.

Like car insurance: charges more when there are accidents

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27
Q

When making Claims under accidental death and dismemberment benefit rider, the document needed is…

A

The accompanying physicians statement.

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28
Q

A witness to a trust Nomination form must be at least

A

21 years old and that’s all. Besides mental capacity, no other requirements required.

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29
Q

A mirror fund is one that tries to

A

Duplicate the composition of an existing fund

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30
Q

A managed fund is also known as the

A

Balanced fund

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31
Q

One feature of Pure life annuity is…

A

It provides a guaranteed income

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32
Q

In making a death claim, the attending physicians statement is usually paid for by the

A

Claimant

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33
Q

Survival period of a Critical illness insurance rider is a specific period of time from date of…

A

Occurrence of critical illness

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34
Q

Information about the employment status and position held enables the insurer to check…

A

If the amount of insurance proposed is justifiable

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35
Q

Life insurance asked for exact nature of job duties because

A

It allows insurer to access the risk of the job

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36
Q

What rights agents have in respect of their relationship with principle under common law?

A

Remuneration and indemnity

Mean agents are paid for their work and do not need to have responsibility for the products of the co.

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37
Q

Technique used to protect policy owner from risk of severe price decline of any one stock is

A

Diversification

38
Q

Compulsory document to give to proposer during sales process?

A

Benefit illustration

39
Q

Under risk based capital (rbc) framework, reserving for future bonuses is required for

A

Both annual and terminal bonus.

Co has to put aside all these monies

40
Q

What should be considered for the promise by the policy owner to forgo all rights under an insurance policy

A

The surrender value

41
Q

What policies likely lead to premium increasing at each subsequent renewal date?

A

Yearly renewable premium policies.

Like car insurance.

Insurance is an agreement for that amount of time. Hedging against any increase.

42
Q

For a risk to be insurable, the loss must not be …

A

Catastrophic to the insurer

43
Q

Interim bonuses are paid on participating policies on.

A

Premature termination of policy during the year before bonus allocation

44
Q

When was the nomination of beneficiaries framework introduced?

A

2009

45
Q

Nomination of beneficiaries framework was introduced to

A

Provide financial protection to named beneficiaries

46
Q

When maturity claim is paid, a discharge voucher is:

A

Required by some insurers, but not all

47
Q

A person under 21 may make a will if

A

he is a mariner at sea.

48
Q

The individual income tax payable is based on the individual

A

chargeable income

49
Q

An insurer will reinstate a life insurance policy which has lapsed only of it relieves evidence of the

A

Insurability of the life insured

50
Q

What way of assigning a policy is typically used for a bank loan?

A

Assignment for valuable consideration

51
Q

If policy proceeds are not covered by a will, the claimant will have to apply to the court for

A

A letter of administration

52
Q

Under an investment linked life policy that has surrender charges, surrender charges are usually at:

A

% of cash value that decrease from the first year onwards

53
Q

Under the terms of the waiver of premium upon total and permanent disability (TPD) Rider, the waiting period is

A

6months

54
Q

Who must disclose all facts material to the contract and represent them truthfully?

A

Both the proposer and the insurer

55
Q

The initial sales charge is another term for

A

Bid Offer spread

56
Q

In assessing a key- person insurance risk, an underwriter needs to review the proposing company’s financial statement to establish the appropriateness of the

A

sum assured

57
Q

Sum assured under a Group term life insurance policy is usually determined by the _______________of the employee

A

Seniority

58
Q

Annuity income benefit of the Fixed Period Temporary annuity will continue until the expiry of the fixed period provided the annuitant is dead or alive?

A

Dead

59
Q

“First to die” and “Last Survivor” are 2 types of

A

Joint Life Policies

60
Q

Which rider will increase the benefit payable on death?

A

Term Rider

61
Q

When an insurer grants an agent to canvass for new business, this type of authority is called__________

A

Actual

62
Q

Terminal Bonus is usually

A

paid on a participating policy when a death claim occurs

63
Q

Trust Nomination is allowed for

A

Personal accident with death benefit policies

64
Q

If there is a breach found by the insurer by the insured, can the financial adviser be sued for compensation?

A

No

65
Q

What are 3 things applies to Mortgage Decreasing Term Insurance?

A
  1. Can be purchased on a joint life basis
  2. The premium ceases a few years before expiry of the policy
  3. The coverage reduces considerably towards the end of the policy term.
66
Q

In the proposal form, the section on particulars of the proposer does not need to be completed if

A

he is buying insurance on his own life.

67
Q

Which document is not given to prospective clients before they purchase an investment linked policy?

A

Profile statement.

68
Q

First Premium Payment is not given what kind of receipt?

A

Official Receipt

69
Q

______________ is not a common method of bonus distribution

A

Group Bonus

70
Q

An agent will not lose his right to be indemnified by his principle is

A

the act which he claims indemnity is legal.

71
Q

What is not usually required for issuance of a duplicate policy?

A

Deed poll.

72
Q

What does not apply to the policy owner when he revokes a trust nomination?

A

Amending an existing will.

73
Q

What is not a common restriction on convertible options?

A

Conversion allowed only if evidence of insurability is provided.

Eg: My policy is converted to me without assessing my insurability.

74
Q

A policy Owner is having difficulty making premium payment. what options does he have?

A

apply for a policy loan
change the premium payment mode
convert the policy into a paid up policy.

75
Q

Now that a life policy has cash value, what are some of the options of the owner?

A

Take a loan on the policy
use the cash value to pay premiums
convert the policy to paid policy.

76
Q

Now that a life policy has cash value, what can the owner not do?

A

buy additional sum assured with the cash value

77
Q

when is a AIDS risk not assessed by the insurer

A

when the marital status indicates a higher risk.

My own reason: usually sex life of the partner is not accessed by the insurer.
They look only at the individual.

78
Q

What are some of the benefits of investing through an investment linked life insurance policy?

A

Access to professional investment management
Access to financial market with modest capital
Flexibility in varying insurance protection and premium payment.

79
Q

what can investment linked policy NOT provide

A

stable returns

80
Q

Convertible options are not offered with which policy?

A

whole life

81
Q

common ways to pay for premium?

A

cash
giro
cheque

82
Q

who can be executor of the will

A

testator
beneficiary
solicitor who draws up the will

83
Q

what are the mechanics of endowment insurance policy?

A

pay for 20 years 100k
covered for 20years 100k
takes back 100k if the survives 20years

84
Q

Amy buys emdownment for 5yr old that matures at 21yrs

Rider on policy pays son income of 500/month if she dies until 21years old. this rider is….

A

Family income Benefit rider

85
Q

what is MOST suitable for a co to buy for its key person insurance?

A

Level term insurance policy

86
Q

A clamiant certified disabled and unable to work again in his own profession or similar but there are some he can work in. Can Recieve TPD benefit?

A

depends on the definitions used

87
Q

To exercise the convertible option on a term insurance policy is to change the policy into

A

a permanent one for the same sum assured

88
Q

what can result in the lowest tax payable by taxpayer?

A

parenthood tax rebate of 5000

89
Q

With guaranteed returns and less non guaranteed bonuses, it means the policy is more conservative with its investment?

A

yes

90
Q

Lowest first year premium for the same sum assured in respect for a 30 year old male?

A

20 year term assurance

91
Q

will receive any benefit If die during grace period of not paying the latest premium?

A

Not at all.

92
Q

If policy owner returns ILP using the free look period provision? with no medical fee incured during underwriting the policy, insurer will

A

return premium paid.

adjust to reflect changes in unit price.

M9 Insurance Mock Paper (1 decks)

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