LICENTIATE EXAMS

I. Select the appropriate answer to complete sentence i. Insurance works on the principle of: a. Sharing of losses b. Probabilities c. Large numbers d. Randomness e. All of the above Ans: e. All of the above. ii. Insurance helps to: a. Prevent adverse situations from occurring b. Reduce the financial consequences of adverse situations c. Negate all consequences of adverse situations d. Make assets continuously productive e. All of the above Ans: b. Reduce the financial consequences of adverse situations. II. State which of the statements is/are correct i. The term Risk includes: a. Damage to machinery and property b. Impact on the health or life of a person c. Leakage of toxic products into the atmosphere d. Effect on the healthy life of the neighbourhood e. All of the above Ans: e. All of the above. ii. The main purpose of having Life insurance is: a. As an avenue for long-term investment b. As a medium for getting income tax benefits from savings c. As a governmental programme for reducing poverty d. As an avenue for short-term investment e. None of the above Ans: e. None of the above. III. Answer the questions below by selecting the correct answer: i. Which of the following intermediaries do not require IRDAs licence/ approval to operate in India? a. Insurance Brokers b. Insurance Agents c. Third Party Administrators d. Surveyors e. All the above intermediaries require IRDAs licence/ approval Ans: e. All the above intermediaries require IRDAs licence/ approval ii. An actuary is expected to: a. Make an exact forecast of the future liabilities of policies b. Make a reasonable forecast of the future liabilities of policies c. Calculate the premium required to cover a risk on a long-term basis d. Find the probability of an insured event to happen in non-life policies e. All the above statements are incorrect Ans: b. Make a reasonable forecast of the future liabilities of policies

PRINCIPLES OF INSURANCE: IC-01 SAMPLE PAPER*

IV. Fill in the Blanks using the appropriate word(s) i. The principle of _____________ ensures that an insured does not profit by insuring with multiple insurers a. Subrogation b. Contribution c. Co-insurance d. Indemnity e. Particular Average Ans: b. Contribution

ii. The principle of average applies when the value is _____________ in the proposal a. Understated b. Overstated c. Not ascertainable d. Negligible e. Only sentimental Ans: a. Understated iii. Fidelity Guarantee Policies cover losses due to fraud by ____________ a. Employees b. Customers c. Borrowers d. Suppliers e. Financiers Ans: a. Employees V. Select the expanded form of the abbreviation given i. CTL as used in insurance a. Contributory Total Loss b. Constructive Total Loss c. Construction Totally Lost d. Contractors Total Loss e. Co-insurers Tally of Loss Ans: b. Constructive Total Loss ii. GA as used in insurance a. General Assurance b. General Average c. General Adjustment d. Guaranteed Assurance e. Guaranteed Average Ans: b. General Average VI. Select the word(s) t hat most closely matches the given term. i. Which of the following terms matches closest with Family Floater? a. Health insurance b. Property insur ance c. Accidental injury d. Consequential loss e. Marine Partial Loss Ans: a. Health insurance ii. Which of the following terms matches closest with Asbestosis? a. Products b. Pension c. Rough Weather d. Workmens Compensation e. Long Term Policies Ans: d. Workmens Compensation VII. Find out which of the given statements is incorrect i. Regarding Exclusions find out the incorrect statement. a. Exclusions are indicated in the policy b. Exclusions are perils or circumstances not covered c. Exclusions limit the coverage under the policy d. Exclusions do not deal with risk coverage e. All the above statements are incorrect. Ans: d. Exclusions do not deal with risk coverage ii. Which of the following statements is incorrect in respect of brokers? a. Brokers require to undergo training before being licensed b. Brokers are appointed by insured to take care of their interests c. Brokers have to pass examinations before being licensed d. Brokers should be registered companies or firms e. Brokers are allowed to negotiate with different insurers for the same insured Ans: d. Brokers should be registered companies or firms

VIII i. Which of the following terms is dissimilar to the other four options? (Find the odd-man out?) a. Jettison b. Hit and Run c. Sue and Labour d. Salvage e. Contamination Ans: b. Hit and Run

ii. Which of the following terms is dissimilar to the other four options? (Find the odd-man out?) a. Post-hospitalisation expenses b. Expenses on treatment of pre-existing diseases c. Reinstatement value d. Funeral expenses e. Ambulance charges Ans: c. Reinstatement value

LICENTIATE EXAMS
I. Select the appropriate answer to complete the sentence i. Insurance business is transacted in India primarily as per the provisions of: a. Insurance Regulatory and Development Authority Act, 1999 b. Insurance Act, 1938 c. Life Insurance Corporation Act, 1956 d. Employees State Insurance Act, 1948 e. Motor Vehicles Act 1938 Ans: b. Insurance Act, 1938. ii. Section 64 C of the Insurance Act, 1938 contains provisions relating to: a. Insurance Regulator y and Development Authority b. Life Insurance Corporation of India c. The Life Insurance Council d. General Insurance Corporation of India e. Tariff Advisory Committee Ans: c. The Life Insurance Council II. State which of the statements is/are correct

REGULATION OF INSURANCE BUSINESS: IC-14 SAMPLE PAPER*

i. Functions of the Executive Committee of the General Insurance Council include: a. To advise and assist general insurers b. To underwrite general insurance business c. To advise and assist life insurance companies d. To settle all complicated general insurance claims e. To audit all general insurance companies Ans: a. To advise and assist general insurers ii. As per IRDA Regulations, insurers should ensure that their advertisements present a correct picture. This provision is most important in the case of: a. The Government b. Insurance Regulatory and Development Authority c. Auditors d. Policyholders e. Shareholders Ans: d. Policyholders III. Answer the questions below by selecting the correct answer: i. Which provision of the Insurance Act 1938 specifies about nomination by policyholder? a. Section 38 b. Section 39 c. Section 40 d. Section 41 e. Section 45 Ans: b. Section 39 ii. Which Regulation of IRDA provides for a Grievance Redressal Procedure? a. IRDA (Policyholders Interests) Regulations, 2002 b. IRDA (Meetings) Regulations, 2000 c. IRDA (Regulation of Indian Insurance Companies) Regulations, 2000 d. IRDA (Reinsurance Advisor y Committee) Regulations, 2001 e. IRDA (Micro-insurance) Regulations, 2005 Ans: a. IRDA (Policyholders Interests) Regulations, 2002

IV. Fill in the Blanks using the appropriate word(s) i. Redressal of Public Grievances Rules, 1998 created the system of ____ a. Insurance Agency b. Insurance Surveyors c. Insurance Ombudsman d. State Commission e. Consumer Forum Ans: c. Insurance Ombudsman

ii. The technique of making small deposits in various financial institutions so that they do not attract the attention of legal/ enforcement authorities is called ______ a. Phishing b. Smurfing c. Internet surfing d. Know Your Customer e. Subrogation Ans: b. Smurfing V. Select the expanded form of the abbreviation given i. Select the expanded form of AML as used in insurance a. Anti-Money Laundering b. Anti-Money Lending c. Adjuster of Monetary Losses d. Averages of Marine Losses e. Adjustment of Motor Losses Ans: a. Anti-Money Laundering ii. Select the expanded form of ULIP used in insurance a. Unit Linked Investment Policy b. Universal Life Insurance Policy c. Umbrella Life Insurance Policy d. Unit Linked Insurance Policy e. Underwriting Linked Insurance Policy Ans: d. Unit Linked Insurance Policy VI. Select the word(s) that most closely matches the given term.

i. Which of the following terms matches closest with Rebates? a. Financial Inducement b. Investment Planning c. Infrastructure Bonds d. Assignment of Policy e. Transfer of Policy Ans: a. Financial Inducement ii. Which of the following terms matches closest with Nomination? a. Loss of Property Documents b. Loss of Merchandise c. Loss of Life d. Loss of Baggage e. Loss of Passport Ans: c. Loss of Life

VII. Which of the following terms is dissimilar to the other four options? (Find the odd -man out?) i. Which of the following authorities is dissimilar to the other four? a. District Forum b. State Commission c. National Commission d. Law Commission e. Ombudsman Ans: d. Law Commission ii. Which of the following types of nominations is dissimilar to the other four? a. In favour of spouse b. In favour of minor child c. In favour of major child d. In favour of adopted child e. In favour of insurance agent Ans: e. In favour of insurance agent .

LICENTIATE EXAMS

PRACTICE OF LIFE INSURANCE IC-02 SAMPLE PAPER*

1. A plan of insurance is said to be different from another if A. the sum assured is different B. the age of the life to be insured is different C. the date of commencement of policy is different D. the conditions when the sum assured becomes payable are different E. none of the above 2. Which one of the following statements is correct? A. a whole life plan is basically a term insurance plan * B. a money back plan is basically a pure endowment plan C. both the statements above are correct D. both the statements above are wrong E. none of the above

3. Which one of the following statements is correct? A. convertible plans allow whole life plans to be altered to endowment plans * B. the option of conversion can be exercised whenever the policyholder chooses to C. both the statements above are wrong D. both the statements above are correct E. none of the above 4. Which one of the following statements is correct? A. a joint life policy may cover partners in business under one policy B. a joint life policy may cover a married couple under one policy C. both the above statements are wrong D. both the statements above are correct * E. none of the above 5. Which one of the following statements is correct? a. a variable insurance plan combines an insurance plan with an investment plan b. a variable insurance policy guarantees a return or yield c. both the statements above are correct d. both the statements above are wrong e. none of the above 6. Which one of the following statements is correct? a. the policy is the basis of the insurance contract b. the proposal is the basis of the insurance contract* c. both the statements above are correct d. both the statements above are wrong e. none of the above 7. Which one of the following statements is correct? a. the declaration in the proposal makes the principle of good faith operational b. the declaration in the proposal establishes insurable interest c. both the statements above are correct* d. both the statements above are wrong e. none of the above 8. Which one of the following statements is correct? a. a paid up policy is entitled to further bonuses b. a paid up policy is entitled to further bonuses if it is a with profits policy c. both the statements above are correct d. both the statements above are wrong * e. none of the above 9. Which one of the following statements is correct? a. in an assignment, property is transferred * b. when a nomination is made, property is transferred c. both the statements above are correct d. both the statements above are wrong e. none of the above 10. What is meant by a claim under an insurance policy? a. any demand made by the policyholder on the insurer b. a demand to fulfill the policyholders obligations c. a demand to fulfill the insurers obligations * d. all the three above e. none of the above 11. Which one of the following statements is correct? a. maturity proceeds are paid to the nominee, if the policyholder dies earlier

b. c. d. e.

maturity proceeds are paid to the heirs, if the policyholder dies earlier * both the statements above are correct both the statements above are wrong none of the above

12. Which one of the following statements is correct? a. if a person is missing for seven years, the claim is called a death claim b. a claim can be admitted if the life insured is not heard of for seven years c. both the statements above are correct * d. both the statements above are wrong e. none if the above 13. Which one of the following statements is correct, if trustee is not appointed? a. a claim under the MWP act policy will be paid to the official trustee * b. a claim under the MWP act policy will be paid to the beneficiaries c. both the statements above are correct d. both the statements above are wrong e. none of the above 14. What does a premium depend upon? a. age of the person to be insured b. family history of the person to be insured c. medical history of the person to be insured d. all of the above * e. none of the above 15. The premium rates printed in the promotional literature are a. risk premiums b. net premiums c. office premiums * d. none of the above e. all of the above 16. Which one of the following statements is correct? a. the life fund belongs to the policyholders * b. the life fund belongs to the shareholders c. both the statements above are correct d. both the statements above are wrong e. none of the above

* More Sample Qs are put up on the III website, for Associateship and Fellowship exams on the link given as:
http://www.insuranceinstituteofindia.com/InsuranceInst/Home/ASPX/IIINewsDetail.aspx?QID=160