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 3 of 11

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Q21.
In an absolute assignment, who has control over the policy's rights and benefits?

a.

The assignor

b.

The life assured

c.

The insurance company

d.

The assignee

Discuss
Answer: (d).The assignee Explanation:In an absolute assignment, the assignee has control over the policy's rights and benefits.
Q22.
What is the primary scenario where absolute assignment is commonly used?

a.

When the policyholder wants to change the nomination

b.

When the policy is mortgaged for a housing loan

c.

When the assignor wants to maintain some control over the policy

d.

When the assignee agrees to reversion

Discuss
Answer: (b).When the policy is mortgaged for a housing loan Explanation:Absolute assignment is more commonly seen when the policy is mortgaged against a debt assumed by the policyholder, such as a housing loan.
Q23.
What is one of the necessary conditions for a valid assignment?

a.

The assignment must be opposed to the law in force

b.

The assignee can do another assignment but cannot change the nomination

c.

The assignor must have an absolute right and title to the policy

d.

The assignor must be the life assured

Discuss
Answer: (c).The assignor must have an absolute right and title to the policy Explanation:One of the necessary conditions for a valid assignment is that the assignor must have an absolute right and title or assignable interest to the policy being assigned.
Q24.
Can the assignee change the nomination of the policy?

a.

Yes, the assignee can change the nomination at any time.

b.

No, the assignee cannot change the nomination because the assignee is not the life assured.

c.

The assignee can only change the nomination with the consent of the assignor.

d.

The nomination can never be changed after assignment.

Discuss
Answer: (b).No, the assignee cannot change the nomination because the assignee is not the life assured. Explanation:No, the assignee cannot change the nomination because the assignee is not the life assured.
Q25.
What is the requirement for a valid assignment of a life insurance policy?

a.

The assignee's signature on the policy

b.

The policyholder's consent

c.

At least one witness

d.

The insurer's approval

Discuss
Answer: (c).At least one witness Explanation:A valid assignment of a life insurance policy must be signed by the assignor and attested by at least one witness.
Q26.
Can a life insurance policy be assigned partially?

a.

Yes, it can be assigned in part.

b.

No, it can only be assigned as a whole.

c.

Partial assignment is allowed only with the insurer's approval.

d.

Partial assignment is not possible for life insurance policies.

Discuss
Answer: (a).Yes, it can be assigned in part. Explanation:A life insurance policy can be assigned wholly or partially.
Q27.
What is the consequence if the policyholder fails to give notice of the assignment to the insurer?

a.

The assignment is automatically void.

b.

The assignee becomes the policyholder.

c.

The assignment remains valid.

d.

The insurer must approve the assignment without notice.

Discuss
Answer: (a).The assignment is automatically void. Explanation:The assignment will not be valid if the policyholder fails to give notice of the assignment to the insurer.
Q28.
When can an insurer refuse to accept an assignment of a life insurance policy?

a.

Only if the policyholder does not provide notice

b.

If the insurer believes the assignment is not in the interest of the policyholder

c.

If the assignee is a family member of the policyholder

d.

Insurers are not allowed to refuse assignments

Discuss
Answer: (b).If the insurer believes the assignment is not in the interest of the policyholder Explanation:An insurer may refuse to accept an assignment if it has sufficient reason to believe that the assignment is not bona fide or not in the interest of the policyholder or the public interest.
Q29.
What is the maximum time frame within which an insurer must communicate the reasons for refusing an assignment?

a.

10 days from the date of notice

b.

30 days from the date of notice

c.

60 days from the date of notice

d.

90 days from the date of notice

Discuss
Answer: (b).30 days from the date of notice Explanation:The insurer must communicate the reasons for refusing an assignment to the policyholder not later than thirty days from the date of the policyholder giving notice of such transfer or assignment.
Q30.
What is the purpose of issuing a duplicate policy in life insurance?

a.

To terminate the existing policy

b.

To absolve the insurance company of its liability

c.

To replace a lost or destroyed policy document

d.

To apply for a policy loan

Discuss
Answer: (c).To replace a lost or destroyed policy document Explanation:A duplicate policy in life insurance is issued to replace a lost or destroyed policy document, but it doesn't absolve the insurance company of its liability under the contract.
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