Question

What is the difference between extra premium based extra mortality rate and standard extra premium?

a.

Extra premium based extra mortality rate is a flat or standard rate applied for expected extra mortality rate, while standard extra premium is the extra mortality rate converted into extra premium.

b.

Extra premium based extra mortality rate and standard extra premium are the same.

c.

Extra premium based extra mortality rate is only charged for specific individuals, while standard extra premium is charged for all individuals covered by the product.

d.

None of the above

Posted under IC22 Life Insurance Underwriting

Answer: (a).Extra premium based extra mortality rate is a flat or standard rate applied for expected extra mortality rate, while standard extra premium is the extra mortality rate converted into extra premium. Explanation:Extra premiums can be loaded in two ways: extra premium based extra mortality rate and standard extra premium. In extra premium based extra mortality rate, the extra mortality rate that has been calculated for sub-standard life and the risk associated is converted into extra premium, which is then charged in addition to the tabular premium. In standard extra premium, a flat or standard rate is applied for expected extra mortality rate for a certain adverse factor such as dangerous hobbies like mountaineering. Hence, all prospects who are engaged in dangerous hobbies will be charged an extra premium of a specified amount for getting the cover.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. What is the difference between extra premium based extra mortality rate and standard extra premium?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What are the two kinds of exclusions that an underwriter can impose when accepting a risk with exclusions?

View solution

Q. In which case would an underwriter defer or postpone a decision on a proposal?

View solution

Q. How long can an underwriter defer or postpone a decision on a proposal?

View solution

Q. What is the benefit of deferment or postponement of risk for the insurer?

View solution

Q. In which case would an underwriter decline a proposal?

View solution

Q. Can an underwriter decline a proposal from an applicant with an incurable disease?

View solution

Q. In which of the following ways can an insurance company communicate its terms of acceptance to a life insured?

View solution

Q. What are riders in life insurance policies?

View solution

Q. When can riders be added to a life insurance policy?

View solution

Q. Do riders need to be underwritten like the base cover?

View solution

Q. Which rider can be added only at the commencement of the policy contract?

View solution

Q. What is the purpose of the waiver of premium (WoP) rider or Premium Waiver Benefit (PWB) rider?

View solution

Q. What is the purpose of the critical illness (C.I.) rider?

View solution

Q. What is the purpose of the accidental death benefit (ADB) rider?

View solution

Q. What is the purpose of the total permanent disability benefit rider (TPD)?

View solution

Q. What is the purpose of the term rider?

View solution

Q. What is the purpose of the Waiver of Premium (WoP) rider?

View solution

Q. When is the Waiver of Premium (WoP) rider more popularly used?

View solution

Q. What happens if the life insured (parent) dies in a child plan with the Waiver of Premium (WoP) rider?

View solution

Q. What is the purpose of the Accidental Death Benefit (ADB) rider?

View solution
View All MCQs on IC22 Life Insurance Underwriting

Recommended Subjects

Are you eager to expand your knowledge beyond IC22 Life Insurance Underwriting? We've handpicked a range of related categories that you might find intriguing.

Click on the categories below to discover a wealth of MCQs and enrich your understanding of various subjects. Happy exploring!

Mechanical Engineering

Explore the world of Mechanical Engineering with our specialized category. Dive into...

DC Machines

Dive into the fundamentals of direct current (DC) machines with our specialized...

Marketing and Marketing Management

Uncover the strategies and tactics of marketing with our Marketing and Marketing...

Basic Electrical Engineering

Master the fundamentals of Electrical Engineering with our specialized category....

Engineering Geology

Explore the dynamic field of Engineering Geology with our specialized category. Delve...

Human Resource Management

Explore the dynamic field of Human Resource Management (HRM) with our dedicated...

Optical Communication

Explore the world of high-speed data transmission with our Optical Communication...

Cell Biology

Delve into the fascinating world of Cell Biology with our specialized category....

Business Statistics

Uncover the power of data analysis with our Business Statistics category. Explore...