L08 Life Insurance Underwriting MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on L08 Life Insurance Underwriting, 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 L08 Life Insurance Underwriting 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 L08 Life Insurance Underwriting mcq questions that explore various aspects of L08 Life Insurance Underwriting problems. Each MCQ is crafted to challenge your understanding of L08 Life Insurance Underwriting 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 L08 Life Insurance Underwriting MCQs are your pathway to success in mastering this essential IC38 Life Insurance Agent Exam topic.

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L08 Life Insurance Underwriting MCQs | Page 4 of 7

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Q31.
Under what conditions may a life insurance proposal for a minor be submitted?

a.

When the minor has a well-developed physique

b.

When the minor's family history is favorable

c.

When the minor has no need for insurance

d.

When submitted by a parent or legal guardian

Discuss
Answer: (d).When submitted by a parent or legal guardian Explanation:Minors typically have no contracting power, so their life insurance proposals must be submitted by a parent or legal guardian.
Q32.
What factors are considered when assessing insurance for minors?

a.

Income and job stability

b.

Properly developed physique and good family history

c.

Marital status and financial investments

d.

Amount of debt and credit score

Discuss
Answer: (b).Properly developed physique and good family history Explanation:When considering insurance for minors, factors like their physique, family history, and need for insurance are assessed.
Q33.
When does the amount of insurance raise concerns for an underwriter?

a.

When the proposed insured's annual income is high

b.

When the ratio of sum assured to annual income is significantly higher than typical levels

c.

When the insurance is related to suicide or expected health deterioration

d.

When the insurance is sold by an experienced salesperson

Discuss
Answer: (b).When the ratio of sum assured to annual income is significantly higher than typical levels Explanation:The underwriter may raise concerns when the ratio of sum assured to annual income is significantly higher than usual, which could indicate certain risks.
Q34.
What percentage of an individual's annual income is generally considered acceptable for life insurance premiums?

a.

One-half

b.

Two-thirds

c.

One-third

d.

Three-fourths

Discuss
Answer: (c).One-third Explanation:Typically, the premium payable for life insurance should be within one-third of an individual's annual income to ensure affordability and continued payment.
Q35.
Why does the age of the proposed insured raise concerns for underwriters?

a.

Because advanced age indicates a lower risk of mortality

b.

Because the risk of degenerative diseases decreases with age

c.

Because chances of degenerative diseases and mortality risk increase with age

d.

Because insurance for older individuals is typically more affordable

Discuss
Answer: (c).Because chances of degenerative diseases and mortality risk increase with age Explanation:Advanced age is associated with an increased risk of degenerative diseases and higher mortality risk, which raises concerns for underwriters.
Q36.
What kind of special reports might life insurers request for high sums assured or advanced age proposals?

a.

Educational qualifications

b.

Job history and employment status

c.

ECG, EEG, X-Ray, and Blood Sugar tests

d.

Family background and social affiliations

Discuss
Answer: (c).ECG, EEG, X-Ray, and Blood Sugar tests Explanation:Life insurers may request special reports like ECG, EEG, X-Ray, and Blood Sugar tests for high sums assured or advanced age proposals to gain deeper insights into the proposed insured's health.
Q37.
In which situation might an underwriter inquire further about a proposal?

a.

When the proposal is made on the life of a close family member

b.

When the agent is related to the proposed insured

c.

When the proposed insured is below the age of 50

d.

When the proposed insured has a well-developed physique

Discuss
Answer: (b).When the agent is related to the proposed insured Explanation:In cases where the agent is related to the life assured, an underwriter may inquire further by requesting a moral hazard report from a branch official.
Q38.
Why might an underwriter inquire about a proposal made at a branch located far away from the proposed insured's residence?

a.

To determine the proposed insured's income level

b.

To assess the financial stability of the proposed insured

c.

To ensure that the medical examination is performed by a qualified examiner

d.

To evaluate the proposed insured's family history

Discuss
Answer: (c).To ensure that the medical examination is performed by a qualified examiner Explanation:When a proposal is made at a branch far from the proposed insured's residence, the underwriter may inquire to ensure that the medical examination is performed by a qualified examiner.
Q39.
What is the primary source of occupational hazards that can affect insurability?

a.

Accident

b.

Health hazard

c.

Moral hazard

d.

All of the above

Discuss
Answer: (d).All of the above Explanation:Occupational hazards can arise from accidents, health hazards, and moral hazards associated with certain types of jobs.
Q40.
Which of the following is an example of a health hazard related to an occupation?

a.

Circus artistes

b.

Scaffolding workers

c.

Exposure to toxic substances

d.

Dancers in a nightclub

Discuss
Answer: (c).Exposure to toxic substances Explanation:Health hazards can arise when individuals are exposed to toxic substances in their workplaces, such as mining dust or carcinogenic chemicals.
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