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 7 of 11

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Q61.
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.
Q62.
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.
Q63.
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.
Q64.
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.
Q65.
In the case where the nominee is a minor, what additional step must the policyholder take?

a.

Nominate a secondary beneficiary

b.

Appoint an appointee

c.

Cancel the nomination

d.

Surrender the policy

Discuss
Answer: (b).Appoint an appointee Explanation:When the nominee is a minor, the policyholder needs to appoint an appointee. The appointee must sign the policy document to consent to acting in that role.
Q66.
What happens to the status of appointees when the nominee reaches the majority age?

a.

Appointees continue to hold their status

b.

Appointees become the policyholders

c.

Appointees lose their status

d.

Appointees are automatically replaced by the legal heirs

Discuss
Answer: (c).Appointees lose their status Explanation:The appointees lose their status when the nominee reaches the majority age.
Q67.
If no appointee is designated, and the nominee is a minor, who receives the death claim proceeds on the death of the life assured?

a.

The insurance company

b.

The policyholder

c.

The legal heirs of the policyholder

d.

The nominee

Discuss
Answer: (c).The legal heirs of the policyholder Explanation:If no appointee is given, and the nominee is a minor, the death claim is paid to the legal heirs of the policyholder.
Q68.
How is the death claim payable when more than one nominee is appointed?

a.

The death claim is paid to the nominee with the highest priority

b.

The death claim is paid to all nominees jointly

c.

The death claim is paid to the survivor or survivors among the nominees

d.

The death claim is not payable to the nominees

Discuss
Answer: (b).The death claim is paid to all nominees jointly Explanation:When more than one nominee is appointed, the death claim will be payable to them jointly, meaning it is paid to all the nominees together.
Q69.
How are nominations made after the commencement of the policy made effective?

a.

Nominations are effective immediately

b.

Nominations are not allowed after the policy has commenced

c.

Nominations have to be communicated to the insurers to be effective

d.

Nominations can only be made through a will

Discuss
Answer: (c).Nominations have to be communicated to the insurers to be effective Explanation:Nominations made after the commencement of the policy have to be intimated to the insurers to be effective.
Q70.
According to Section 39(11) of the Insurance Act, who is entitled to the proceeds and benefits of a policy if the policyholder dies after the policy matures but before the proceeds are received?

a.

The insurance company

b.

The legal heirs of the policyholder

c.

The nominee

d.

The appointee

Discuss
Answer: (c).The nominee Explanation:According to Section 39(11) of the Insurance Act, if the policyholder dies after the maturity of the policy but the proceeds and benefits of the policy have not been made to him because of his death, his nominee shall be entitled to the proceeds and benefits of his policy.
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