L07 Life Insurance Documentation MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on L07 Life Insurance Documentation, a fundamental topic in the field of IC38 Life Insurance Agent Exam. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our L07 Life Insurance Documentation 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 L07 Life Insurance Documentation mcq questions that explore various aspects of L07 Life Insurance Documentation problems. Each MCQ is crafted to challenge your understanding of L07 Life Insurance Documentation principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC38 Life Insurance Agent Exam tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our L07 Life Insurance Documentation MCQs are your pathway to success in mastering this essential IC38 Life Insurance Agent Exam topic.

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L07 Life Insurance Documentation MCQs | Page 11 of 11

Discover more Topics under IC38 Life Insurance Agent Exam

Q101.
What happens to a nominee's rights when a policy loan is outstanding?

a.

The nominee retains full rights to the death benefit

b.

The nominee's rights are unaffected

c.

The nominee's rights are canceled

d.

The nominee receives interest on the outstanding loan

Discuss
Answer: (b).The nominee's rights are unaffected Explanation:When a policy loan is outstanding, the nominee's rights are unaffected, but the nominee's right will be affected to the extent of the insurer’s interest in the policy.
Q102.
What does the process of nomination in life insurance involve?

a.

Determining the premium amount

b.

Selecting the type of policy

c.

Choosing the person or persons to whom the policy money will be paid in case of the policyholder's death

d.

Modifying the policy terms and conditions

Discuss
Answer: (c).Choosing the person or persons to whom the policy money will be paid in case of the policyholder's death Explanation:In life insurance, nomination involves selecting the person or persons to whom the policy money will be paid in the event of the policyholder's death.
Q103.
How many nominees can the life assured nominate for a policy?

a.

Only one nominee is allowed

b.

Multiple nominees are not permitted

c.

One or more than one person can be nominated

d.

Nomination is not allowed

Discuss
Answer: (c).One or more than one person can be nominated Explanation:The life assured can nominate one or more than one person as nominees for a policy.
Q104.
What is the role of the nominees in a life insurance policy?

a.

Nominees become the policyholders

b.

Nominees are entitled to a valid discharge

c.

Nominees must pay the policy premiums

d.

Nominees have the right to cancel the policy

Discuss
Answer: (b).Nominees are entitled to a valid discharge Explanation:Nominees in a life insurance policy are entitled to a valid discharge and have to hold the money as a trustee on behalf of those entitled to it.
Q105.
When can a policyholder make changes to the nomination for a life insurance policy?

a.

Changes can only be made at the time of policy purchase

b.

Changes are not allowed once the policy is issued

c.

Nomination can be cancelled or changed at any time before policy matures

d.

Changes can be made only after the policy matures

Discuss
Answer: (c).Nomination can be cancelled or changed at any time before policy matures Explanation:Nomination can be cancelled or changed at any time before the policy matures, either by an endorsement or a further endorsement or a will, as the case may be.
Q106.
What right does a nominee have in a life insurance claim?

a.

A nominee has the right to the whole claim amount

b.

A nominee has no rights to the claim amount

c.

A nominee has the right to receive the policy monies from the insurer

d.

A nominee becomes the policyholder after the death of the life assured

Discuss
Answer: (c).A nominee has the right to receive the policy monies from the insurer Explanation:A nominee has the right to receive the policy monies from the insurer in the event of the death of the life assured. However, the money would belong to the legal heir.
Q107.
According to Section 39(7) of the Insurance Act, 1938, who becomes beneficially entitled to the claim amount for policies maturing after 26th December 2014?

a.

Only the policy owner

b.

Nominees are the sole beneficiaries

c.

Legal heirs have no rights to the claim amount

d.

Nomination in favor of parents, spouse, children, or spouse and children makes the nominees beneficially entitled to the amount payable

Discuss
Answer: (d).Nomination in favor of parents, spouse, children, or spouse and children makes the nominees beneficially entitled to the amount payable Explanation:According to Section 39(7) of the Insurance Act, 1938, nomination in favor of parents, spouse, children, or spouse and children by the owner of the policy on their own life makes the nominees beneficially entitled to the amount payable by the insurance company.
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