Types of Insurance Products Individual MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Types of Insurance Products Individual, a fundamental topic in the field of IC 92 Actuarial Aspects of Product Development. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Types of Insurance Products Individual MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of Types of Insurance Products Individual mcq questions that explore various aspects of Types of Insurance Products Individual problems. Each MCQ is crafted to challenge your understanding of Types of Insurance Products Individual principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC 92 Actuarial Aspects of Product Development tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Types of Insurance Products Individual MCQs are your pathway to success in mastering this essential IC 92 Actuarial Aspects of Product Development topic.

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Types of Insurance Products Individual MCQs | Page 3 of 17

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Q21.
What is the primary benefit provided by a Term insurance policy?

a.

Health coverage

b.

Investment returns

c.

Death benefit only

d.

Endowment benefit

Discuss
Answer: (c).Death benefit only Explanation:A Term insurance policy primarily provides a death benefit only in the event of the insured's death.
Q22.
What happens if the insured survives the term of the contract in a Term insurance policy?

a.

The premiums are refunded with interest.

b.

A surrender benefit is payable.

c.

The Sum Assured is paid out to the nominees.

d.

No benefit is payable.

Discuss
Answer: (d).No benefit is payable. Explanation:In a Term insurance policy, if the insured survives the term of the contract, no benefit is payable.
Q23.
What is the purpose of a Term insurance policy?

a.

To provide investment returns

b.

To accumulate savings over time

c.

To satisfy the protection need of the policyholder

d.

To offer health coverage

Discuss
Answer: (c).To satisfy the protection need of the policyholder Explanation:The primary purpose of a Term insurance policy is to satisfy the protection need of the policyholder by providing a death benefit.
Q24.
How is the premium paid in a Term insurance policy?

a.

Only as a single premium

b.

Only on a yearly basis

c.

Both year on year or as a single premium

d.

Only on a monthly basis

Discuss
Answer: (c).Both year on year or as a single premium Explanation:The premium in a Term insurance policy can be paid both year on year or as a single premium.
Q25.
What type of contracts fall under Pure Death benefit contracts?

a.

Endowment benefit contracts

b.

Term insurance contracts

c.

Annuity contracts

d.

Health insurance contracts

Discuss
Answer: (b).Term insurance contracts Explanation:Pure Death benefit contracts include Term insurance contracts, which provide a death benefit only if death occurs.
Q26.
What is a characteristic feature of Term insurance contracts?

a.

Availability of loans on the policy

b.

Provision of benefits only in the event of death

c.

Premium payment throughout the policyholder's life

d.

Option to continue the cover without paying any premium after a certain age

Discuss
Answer: (b).Provision of benefits only in the event of death Explanation:Term insurance contracts provide benefits only in the event of death and typically do not offer loans on the policy.
Q27.
Which type of insurance contract provides cover throughout the policyholder's life?

a.

Term insurance contracts

b.

Whole life insurance contracts

c.

Endowment insurance contracts

d.

Annuity contracts

Discuss
Answer: (b).Whole life insurance contracts Explanation:Whole life insurance contracts provide cover throughout the policyholder's life, with the benefit amount paid to the beneficiary upon the policyholder's death.
Q28.
What option is typically available to policyholders in whole life insurance contracts?

a.

Surrender the policy for a cash value

b.

Obtain a loan against the policy

c.

Convert the policy into an annuity

d.

Pay premiums only for a limited period

Discuss
Answer: (d).Pay premiums only for a limited period Explanation:Policyholders in whole life insurance contracts often have the option to pay premiums only for a limited period and then continue the cover till death without paying any premium.
Q29.
What is the primary purpose of whole life insurance contracts?

a.

To provide survival benefits to the policyholder

b.

To accumulate savings over time

c.

To provide a lump sum payment to family members in the event of the policyholder's death

d.

To offer health coverage to the policyholder

Discuss
Answer: (c).To provide a lump sum payment to family members in the event of the policyholder's death Explanation:The primary purpose of whole life insurance contracts is to provide a lump sum payment to family members upon the policyholder's death.
Q30.
What is the main limitation of Term and whole life insurance contracts?

a.

They do not provide benefits in the event of death

b.

They are costly compared to other insurance products

c.

They do not provide survival benefits

d.

They do not offer flexibility in premium payment

Discuss
Answer: (c).They do not provide survival benefits Explanation:Term and whole life insurance contracts do not provide survival benefits, which may not meet all the needs of the policyholder who desires security for themselves or their family while they are alive.
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