Life Insurance MCQ Guide for IC 38

Life Insurance
MCQ Guide
for IC 38
(For Insurance Agents, Corporate Agents,
Web Aggregators, Insurance Marketing Firm)

Authored by:
Dr. Rakesh Agarwal
M.Com(BIM),L.L.B, PGJMC, M.B.A, F.C.A.,DISA, F.I.I.I, Ph.D
Editor
The Insurance Times

Published By :
The Insurance Times
The First monthly Journal on Insurance in India in service
since 1981

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G
©
Dr Rakesh Agarwal, Kolkata
1st Edition November 2016
2nd Edition September 2017
3rd Edition December 2017
4th Edition November 2018

ISBN : 978-93-81489-36-9
Price : ` 175
All Rights reserved by the publishers. No part of this publication can be
published or reproduced in any form, by shuffling of questions,
remodelling of questions or by any means i.e., electronic, mechanical,
including photocopying without the prior permission of the publishers.
Some excerpts has been taken from IC38 published by Insurance
Institute of India in Highlight section of the book. The copyright of those
material rests with Insurance Institute of India.
Every effort has been made to avoid errors or omissions in this
publication. This is a guide book prepared on the basis of syllabus of
Insurance Institute of India for Associate Exam to assist candidates to
pass in exam successfully.
The publishers will not be responsible for loss or damage due to errors
in this publication. Any error, mistake may be brought to our notice, which
shall be taken care in the next edition. All disputes subject to Kolkata
Jurisdiction.

WARNING: Do not Xerox the book. The Book may tear away and we shall not be
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 Life Insurance MCQ Guide for IC 38

Preface
We are happy to launch the 4th Edition of Life Insurance MCQ Guide for
IC 38.

Recently IRDAI has redesigned the syllabus for agency training for
Agents, Corporate Agents, Insurance Marketing Firm and W eb
Aggregators. IRDAI has notified IC38 book as the common book for all
above modes of insurance solicitation.

We have covered thoroughly the whole syllabus prescribed by I.I.I and

the questions and answers are given based on each chapter. The book
has been prepared carefully to cover almost all types of questions that
can be asked in exam.

We hope the candidates will find this book very useful in preparing for
the examination. Please do go through the tips given in this book for
clearing the exam successfully.

We are thankful to Shyam Agarwal, Associate Editor,The Insurance Times

for valuable inputs in the book and for his untiring effort in preparation
of the guide. We also thank Dr Abhijeet Chattoraj for reviewing the book
and making valuable additions.

Though we have tried to make this publication error free, if you come
across any error please email us so that we can correct the same in
next edition.

We wish you best of luck for the examination.

- Editor in Chief,
R. G. Agarwala
The Insurance Times

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Tips for passing the exam successfully
1. Plan out your study programme
in advance so that you do not
leave any important topic.
2. We have covered questions in
various pattern and options so
that the concept of subject is
clear to the candidates. Since the
questions may be twisted in the
exam it is not advisable to mug
up the questions.
3. Before appearing in the
examination try to solve questions
in exam conditions by setting up
time and solving the questions as
if appearing in exam.
4. Do not consult too many things
at a time otherwise you will
confuse everything. Go step by
step.
5. W hen you view the question
paper in the exam do not try to
read all questions instantly as it
will waste your time and if you
don't know answers of some
question you will get tensed.
6. Go through the first page and
answer only the questions which
you are sure. Likewise go
through all the pages and mark
answers only which you are
confident of being correct.
7. Read and read carefully before
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answering any question as the
question might have been
twisted.
8. Before deciding the answer give
stress on the logic and you will
get the correct answer.
9. Always keep some time to review
the paper.
10. Once you complete reading a
chapter in book, attempt for
online mock test. If you do not
score well again go to the
chapter and study again and
reattempt the questions until you
get good marks.
11. In the new pattern of questions
the questions are large so
before answering read questions
very carefully. A single not or
negative or positive construction
may change the answer, so
check whether question is asking
in affirmative or negative.
12. When you receive the question
paper first answer the questions
in which you are confident. Say
you know 40 out of 100 question
then answer them so that you are
confident of securing this mark.
After this you again start from
beginning and read question
twice/thrice if you have confusion.
 Life Insurance MCQ Guide for IC 38
13. As more and more exams are in such type of questions the
being conducted in MCQ pattern answer will be All the above. But
the level of difficulty is again exercise caution become
increasing. A new trend has they may intentionally give this
started where you may find that option to confuse you.
most answers are right. Out of
17. Do not leave any chapter. Focus
this you will have to select the
on all chapters equally. MCQ
best option which best
questions are set from a pool of
resembles the question.
questions. At times it happens
14. Adopt Elimination technique. For that from a particular chapter
example out of 5 option first try many questions are set. You
to figure out the option which is leave any chapter at your sole
absolutely wrong. So go on risk.
eliminating the wrong options to
18. Relax, relax and relax while
arrive at the correct option.
answering. Avoid anxiety. If you
15. Don't leave any question will take strain then chances are
unanswered. Since there is no that you may answer incorrectly
negative marking attempt all the even the questions you know.
questions. Try to arrive at the
19. Well we wish you Best of Luck
most likely answer.
for the exam and hope you clear
16. In many questions you will find the paper in the coming attempt.
the answer All above. Most likely

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Contents

Multiple Choice Question

Section - 1
COMMON CHAPTERS
1. Introduction to Insurance ............................................... 9

2. Customer Service .......................................................... 18

3. Grievance Redressal Mechanism .................................. 30

4. Regulatory Aspects of Insurance Agents,

Corporate Agents, Web Aggregators &
Insurance Marketing Firm ............................................. 38

5. Legal Principle of an Insurance Contract ..................... 48

Answers for all Chapters ......................................................... 58

Section - 2
LIFE INSURANCE
6. What Life Insurance Involves ....................................... 63

7. Financial Planning ......................................................... 71

8. Life Insurance Products - I ........................................... 82

9. Life Insurance Products - II .......................................... 95

10. Application of Life Insurance ..................................... 105

11. Pricing and Valuation in Life Insurance ..................... 112

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 Life Insurance MCQ Guide for IC 38

12. Documentation - Proposal Stage ................................ 126

13. Documentation - Policy Condition- I ......................... 136

14. Documentation - Policy Condition- II ........................ 142

15. Underwriting .............................................................. 166

16. Payments Under a Life Insurance Policy ................... 181

Answers for all Chapters ....................................................... 190

Section - 3
HEALTH INSURANCE
17. Introduction to Health Insurance ............................... 201

18. Insurance Documentation .......................................... 210

19. Health Insurance Products ......................................... 219

20. Health Insurance Underwriting ................................. 234

21. Health Insurance Claims ............................................ 250

Answers for all Chapters ....................................................... 261

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IC 38 Common
Chapters

Highlights
&
Multiple Choice Question

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Chapter - 1
Highlights of Introduction to Insurance
Need for insurance :
From cave age till date, the story of
evolution of mankind is in fact a saga of
continuous search for security. His
problems have remained the same through
the centuries though the form has
changed with the changes in economic
and social circumstances.
When men lived in caves, he searched for
security against animals, because they
could kill him while asleep. He was not
sure, he could hunt every day and get his
food. He lived in a group or tribe so that
other members of the tribe could come to
help in times of crisis. The system of family
was the product of a similar need and to
seek comfort and security against
sickness.
Protecting ones asset has been a
continuous search not only of individuals
but also of groups of people. Theft, fire,
flood etc. have been a scourge against
mankind. Man earns investing his time,
strength and intelligence. He also needs
other instruments like vehicles, factories,
ship for transportation, production and
trade. Each of these resources are
valuable and augment the creation of
further wealth.
But when such aspects are lost or
destroyed much before the expected date,
the calamity is suffered. Human being is
an income generating asset. He expects
to earn during his life time sufficiently so
as to provide for his old age. But when
he dies at an young age, the family remains
unprovided for. A motor vehicle is to last,
say 15 years. During this period, the
owner makes sufficient saving as to
replace it with a new one. But if the vehicle
is totally damaged due to an accident, the
entire capital is lost and the owner can not
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Life Insurance MCQ Guide for IC 38
replace it. It is so with any other asset.
It is the human ingenuity which has found
out a way out of this. As a large number
of members of society face this problem -
problem which is common to all of them,
problem which is beyond the capacity of
any individual to bear, it becom es
necessary for similarly placed individuals
to come together and forge a common
strategy to meet this eventuality of loss of
a valuable asset.
Insurance as a social security tool :
Individual's income is dependent upon the
investment of his time. Over a period of
time, he saves sufficiently to provide for
the time, when he is too old to earn. But
no body can guarantee him this time. This
uncertainty of tim e leads him to the
invention of insurance.
The story goes of a news paper hawker
boy who used to go on cycle to distribute
news papers to earn his livelihood. One
day, when he left his cycle outside a
house and went in to deliver the news
paper, his cycle got stolen. He had
thereafter no means to run around.
Walking would be a slow process and his
income would dwindle. The boy was a
smart one.
He called his other brother hawkers and
narrated his story. Many others in the same
job had similar stories to tell. They just hit
upon an idea. A cycle say would cost Rs.
100/- There were almost 100 hawkers.
Almost every year one cycle was getting
stolen. Only if they could have a fund of
Rs.100/- such a loss suffered by any of
them could be compensated. And the creation
of a fund of Rs.100/- merely means a
contribution of Rs.1/- per person per year.
The concept of insurance was born.
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Role of Insurance in the development
of economy :
From very rudimentary beginnings, the
concept of insurance has travelled a long
distance as to become an effective engine
for the development of economy. The
present day economy, it is said, would be
unthinkable without the business of
insurance. Factories and industries in the
modern days involve investment of
thousand of crores. Aero planes costing
hundreds of crores of rupees fly in the sky.
The ships of today cost a fortune. Each
one of them face the risk of damage to
total destruction for reasons beyond ones
control. If the owner is always to be
worried of their possible loss due to some
such reason, would he be able to sleep in
peace? W ould he turn into a maniac
worrying as to what is going to happen to
him if this asset is lost. Insurance provides
that peace of mind, freedom from worries,
confidence to take risk which alone drives
the economy forward.
Today's economy, it is said, is a credit
economy. The businessmen, the factory
owner, even the ordinary service holder
takes loan to provide for himself capital,
to purchase goods, to start a factory, to
purchase a house, conveyance or even
a holiday. Such credits are available
because of the mechanism of insurance.
Pooling risks and resources :
Such huge funds could not be made
available but for the pooled resources of
the entire society. As we have said in the
above example of the newspaper hawker,
one rupee contribution made it possible to
have a fund of rupees one hundred. The
risks of the loss of the cycle for each
hawker boy was too great to bear. But
when the hundred hawkers pooled their
resources, they distributed their risks in
bearable proportion.
Insurance helps to bring
u Security
u Increase business efficiency
10
u Distribute risks and losses
u Enhance creditworthiness
u Increase earning power
u Help in savings
u Helps in investment
u Promotes thrift
u Reduces destitute
u Helps in better health care
Brief history of insurance
u Insurance has been known to exist
since 3000 BC
u Chinese and Babylonian traders
practiced concept of insurance since
long
u The Greeks started benevolent
societies in the late seventh century
A.D. to take care of funeral and
families of members who died early
u A formal insurance company was
first formed after the great Fire of
London in the year 1666 named as
fire office (1680)
u The origin of modern day insurance
can be traced back to the Lloyd's
coffeehouse in London where the
traders met regularly to share their
losses of goods carried on them by
sea.
u In India insurance first started in the
year 1800 in form of Marine insurance
business
u The first life insurance company to be
set up in India was an English
company, the Oriental life insurance
company Ltd.
u The first non-life insurer to be
established in India was Triton
insurance company
u The first full-fledged Indian insurance
company was Bombay mutual
assurance Society formed in the year
1870 in Mumbai
u Indian insurance companies were
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established as a result of swadeshi
movement in India
u The life insurance business in India
was nationalised in the year 1956
u Life insurance Corporation of India
was formed by the merger of 170
companies and 75 Provident fund
societies transacting life insurance
business in India
u The nonlife insurance was
nationalised in the year 1973 with the
form ation of General Insurance
Corporation and its four subsidiaries.
u GIC and its subsidiary were formed
with merger of 106 companies
transacting nonlife insurance
business in India
The Insurance Act 1938 was the first
legislation enacted to regulate the conduct
of insurance companies in India. This Act,
as amended from time to time continues to
be in force.
In 1993, the Malhotra Committee was setup
to explore and recommend changes for
development of the industry including the
reintroduction of an element of competition.
The Committee submitted its report in
1994.In 1997 the Insurance Regulatory
Authority (IRA)was established.
The passing of the Insurance Regulatory&
Development Act, 1999 (IRDAI) led to the
formation of Insurance Regulatory and
Development Authority of India (IRDAI) in
April 2000 as a statutory regulatory body
both for life, non-life and health
insurance industry. IRDA has been
subsequently renamed as IRDAI in 2014.
Amending the Insurance Act in 2015,
certain tipulations have been added
governing the definition and formation of
insurance companies in India.
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Life Insurance MCQ Guide for IC 38
Role of insurance in society
Insurance companies play an important
role in a country's econom ic
development. They are contributing in a
significant sense to ensuring that the
wealth of the country is protected and
preserved. Some of their contributions are
given below.
a) Their investments benefit the society
at large.
b) These funds are collected and held
for the benefit of the policyholders.
c) The system of insurance provides
numerous direct and indirect benefits
to the individual, his family, to
industry and commerce and to the
community and the nation as a whole
d) Insurance removes the fear, worry
and anxiety associated with one's
future
e) A bank or financial institution may not
advance loans on property unless
it is insured against loss or damage
by insurable perils
f) Insurers also suggest and
recommend to the insured, various
improvements in the risk, which will
attract lower rates of premium.
g) Insurance operations earn foreign
exchange and represent invisible
exports.
Insurers play an important role in
social security schemes sponsored by
the Government such as
1. RKBY - Rashtriya Krishi Bima Yojana
2. RSBY - Rashtriya Swasthya Bima
Yojana
3. PMJBY - Pradhan Mantri Jeevan Jyoti
Bima Yojana
4. PMSBY - Pradhan Mantri Suraksha
Bima Yojana All these benefit the
community in general.
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Multiple Choice Question/Answers

Introduction to Insurance
Model Questions Bank
1. Which of the following events a. Nuclear family system
make us anxious and afraid? b. Life Insurance penetration
a. Fire b. Flood c. Joint family system
c. Earthquake d. Lightning d. Moderate literacy rate
e. All of the above e. None of the above

2. Why do events make us anxious 6. The origins of modern commer-

and afraid? cial insurance business as prac-
a. Events are unpredictable ticed today can be traced to
b. Cause of economic loss and ________ in London.
grief. a. Amicable Society for a Perpetual
c. It causes adrenaline rush in our Assurance
body. b. Lloyd's Coffee House
d. Physical and mental stress c. Swiss Re
e. Only a and b d. Munich Re
e. Berkshire Hathaway
3. Which of these gave the idea of
proper formation of insurance? 7. Amicable Society for a Per-
a. Babylonian and Chinese Traders petual Assurance founded in
b. Traders from Bharuch and surat _____ in London is considered
c. Greeks to be the first life insurance
d. Inhabitants of Rhodes company in the world.
e. All of the above a. 1700 b. 1702
c. 1704 d. 1706
4. The _________ had agreements e. 1708
where they would pay additional
sums to lender, as a price for 8. Which is the first English Life In-
writing off loans, in case a ship- surance company to be set up
ment was lost or stolen. in India?
a. Traders from Bharuch and surat a. The Oriental Life Insurance Co.
b. Greeks Ltd.
c. Babylonian Traders b. Triton Insurance Co. Ltd.
d. Inhabitants of Rhodes c. Bombay Mutual Assurance Soci-
e. Chinese Traders ety Ltd.
d. National Insurance Company Ltd.
5. Which of the follow ing has e. None of the above.
helped India down the ages as
best form of Life Insurance? 9. ___________ is the first non-life

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 Life Insurance MCQ Guide for IC 38
insurer to be established in In- c. Premium-rate tables are certified
dia. by an underwriter.
a. The Oriental Life Insurance Co. d. Periodical valuations of compa-
Ltd. nies are certified by an under-
b. Triton Insurance Co. Ltd. writer.
c. Bombay Mutual Assurance Soci- e. Only a and b.
ety Ltd.
d. National Insurance Company Ltd. 14. The _____ was the first legisla-
e. None of the above. tion enacted to regulate the con-
duct of insurance companies in
10. Bombay Mutual Assurance Soci- India.
ety Ltd. was the first Indian In- a. Insurance Act, 1938
surance company formed in the b. Provident Fund Act, 1912
Mumbai in the year _____. c. Life Insurance companies Act,
a. 1800 b. 1900 1912
c. 1810 d. 1870 d. The IRDAI Act, 1999
e. 1871 e. None of the above.

11. Which is the oldest Insurance
Company in India?
a. The Oriental Life Insurance Co.
Ltd.
b. Triton Insurance Co. Ltd.
c. Bombay Mutual Assurance Soci-
ety Ltd.
d. National Insurance Company Ltd.
e. Only a and d
12. The Life Insurance Companies
Act and the Provident Fund Act
were passed to regulate the in-
surance business in which
year?
a. 1920 b. 1912
c. 1913 d. 1906
e. 1910
13. The Life Insurance Companies
Act made it compulsory that:
a. Premium-rate tables are certified
by an actuary.
b. Periodical valuations of compa-
nies are certified by an actuary.
15. Insurance has been known to
exist in some form or other
since______.
a. 2000 BC b. 1000 BC
c. 3000 BC d. 4000 BC
e. 1500 BC
16. Life Insurance business was na-
tionalized on ___________ and
the Life Insurance Corporation
of India (LIC) was formed.
a. 1st September 1956 b.
10th September 1956
c. 1st October 1956 d. 20th Octo-
ber 1958
e. 30th December 1958
17. The non-life insurance business
was nationalised and the Gen-
eral Insurance Corporation of
India with its 4 subsidiaries was
formed in the year________.
a. 1970 b. 1971
c. 1972 d. 1973
e. 1974

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Answers - Introduc- 25. a. A process by 44. a. Changes made in

which the losses dangerous or
tion to Insurance
of a few, who are hazardous
1. e. All of the above unfortunate to operations.
2. e. Only a and b suffer such 45. c. Separation
3. e. All of the above losses, are shared 46. b. Risk retention
4. c. Babylonian amongst those through self-
Traders exposes to similar financing
5. c. Joint family system uncertain events/ 47. a. Transferring the
6. b. Lloyd's Coffee situations. responsibility for
House 26. e. All of the above losses to another
7. d. 1706 27. b. The asset never party.
8. a. The Oriental Life loses it value; it 48. b. Might
Insurance Co. Ltd. may be replaced 49. a. Will
9. b. Triton Insurance with the insurance 50. b. Insurance
Co. Ltd. contract.
10. d. 1870
Answers - Customer
28. d. All of the above
11. d. National Insurance 29. a. Primary burden of Service
Company Ltd. risk 1. a. Customers
12. b. 1912 30. b. Secondary burden 2. e. Only 1 and 3
13. e. Only a and b. of risk 3. d. All of the above.
14. a. Insurance Act, 31. d. All of the above. 4. e. Only a and b.
1938 32. c. Setting aside 5. e. All of the above
15. c. 3000 BC reserves as a 6. a. The ability to
16. a. 1st September provision for perform the
1956 meeting potential promised service
17. c. 1972 losses in the dependably and
18. d. Only a and b. future. accurately.
19. b. April 2000 33. e. All of the above 7. b. It refers to the
20. e. Only b and c 34. a. Risk avoidance willingness and
21. a. Insurance of part 35. d. Risk avoidance ability of service
of one insurer's 36. c. Risk retention personnel to help
risk by another 37. a. Risk retention customers and
insurer who 38. d. Risk reduction and provide prompt
accepts the risk control response to the
for a mutually 39. e. All of the above. customer's needs.
acceptable 40. a. Loss Prevention 8. c. It refers to the
premium. 41. d. Degree of loss knowledge,
22. c. 24 42. b. Adequate competence and
23. d. All of the above. knowledge for the courtesy of
24. b. Insurance engineers service providers
Regulatory and 43. e. Making and their ability to
Development environmental convey trust and
Authority of India. changes confidence.

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 Life Insurance MCQ Guide for IC 38

Multiple Choice Question/Answers

What Life Insurance Involves
Model Questions Bank

1. Full form of HLV is c. Discounting the future income

a. Human Love Value less the expenses, using an ap-
b. Human Life Value propriate interest rate.
c. Human Long Value d. All of the above
d. Human Light Value
5. Which of the following state-
2. HLV is calculated to ment about HLV is/are correct
a. Ascertain the value of human life a. HLV concepts considers human
in monetary terms life as property or an asset
b. Ascertain the amount of life insur- b. HLV is the only way to determine
ance which can be given to a the amount of insurance which
prospect can be given to a human being
c. Ascertain the monetary loss to c. While calculating HLV, only future
the family in case of death of the earning capacity is considered.
prospect d. All of the above
d. All of the above
6. The insurance is effected to
3. Which of the following statement cover the ___________ an as-
about the HLV is in-correct? set is exposed to
a. HLV is the definite amount of in- a. Peril b. Risk
come which an individual will earn c. Loss d. Event
during his lifetime.
b. HLV considers the future income, 7. Which of the following is not a
which a prospect may earn over category of risk, considered for
his lifetime. life insurance
c. HLV was developed by Prof. a. Dying too early
Hubner. b. Living too long
d. All of the above. c. Accident
d. Living with disability
4. To ascertain HLV, Net earnings is
calculated by 8. "Living too Long" means
a. Adding all the income of the future a. Life post retirement
years. b. Living beyond the age of 60 years
b. All future income less the amount c. Living beyond the age of 80 years
required to be spent on self. d. Living beyond the age of 90 years

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9. "Liability insurance" covers
a. Insurance against frauds by the
debtors
b. Insurance against loss of name
and goodwill
c. Insurance against "Bankruptcy".
d. All of the above
10. General Insurance covers
a. Risks that can affect a person
b. Personal risks
c. Risks that effect property
d. All of the above
11. Life insurance is not
a. A contract of assurance
b. A contract of indemnity
c. Applicable to assets other than
human life
d. A financial asset.
12. Which is the most appropriate
statement(s) vis-a-vis HLV
a. Mr. A's annual earning is Rs.1.5
lacs and has proposed for a life
cover of Rs.5 crore on his life.
b. Mr. B is a student and has pro-
posed for a life cover of 25 lacs
on his life.
c. Both are appropriate
d. Both are not appropriate
13. Which of the follow ing
statement(s) is correct, vis-a-vis
Life insurance contracts
a. Principle of indemnity doesn't
apply.
b. The amount payable at death is
fixed at the beginning of the policy
c. The ultimate beneficiary may not
be the policyholder.
66
d. All of the above statements are
correct
14. Which of the follow ing
statement's is/are true ?
a. The General Insurance contracts
protects against uncertainty.
b. Life insurance policies protects
against certain event.
c. Both are correct.
d. Both are wrong.
15. Which of the follow ing
statement(s) is/are correct ?
a. In Life insurance policies, the risk
is constant.
b. In Life insurance policies, the
coverage is against the time of
death
c. In Life insurance policies, the
actual loss is compensated for.
d. All are correct.
16. Mortality charges would be least
in which of the following
a. A person in the age group of 35-
40 years
b. A person in the age group of 30-
35 years
c. A person in the age group of 21-
25 years
d. A person in the age group of 40-
45 years
17. Mortality charges
a. Increase with increase in age
b. Are not affected by the health of
the prospect.
c. Are constant throughout the
policy term
d. Will be same for all males of 25
years of age.
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Sashi Publications
Answers - What life 20. d. A and C. 42. b. A general
21. a. Level premium insurance policy
Insurance Involves
22. b. Term policy 43. d. Guarantees the
1. b. Human Life Value 23. b. Premiums collected amount payable at
2. d. All of the above in the early years maturity
3. a. HLV is the definite of the policy. 44. d. Pension policy
amount of income 24. a. Excess of the 45. a. Accidental death
which an premiums collected 46. d. All of the above
individual will earn under the policies 47. c. Same premium at
during his lifetime. 25. d. Accident any age
4. c. Discounting the 26. a. Which has more 48. b. Cash Value
future income less of saving element element
the expenses, in the policy 49. b. Diversification
using an 27. b. Its a contract to 50. d. All of the above
appropriate pay the sum
interest rate. assured on
Answers - Financial
5. a. HLV concepts happening of the Planning
considers human event.
life as property or
Set - I
28. a. Provide sense of
an asset financial security 1. e. Only a and d
6. b. Risk to the 2. e. All of the above
7. c. Accident policyholders. 3. e. a, b and c above
8. a. Life post 29. b. Combination of the 4. d. Empty Nester
retirement funds of the 5. e. Empty Nester
9. a. Insurance against various individuals 6. c. Wealth
frauds by the 30. a. A sense of accumulation
debtors financial security 7. b. Bank FD
10. d. All of the above 31. d. All of the above. 8. c. Insurance
11. b. A contract of 32. d. All of the above 9. a. Life insurance
indemnity 33. b. Life insurance 10. c. Spending
12. d. Both are not provides 11. a. Put money to work
appropriate guaranteed 12. c. It's the process to
13. d. All of the above returns identify one's
statements are 34. b. Statutory insurance needs
correct reserves. 13. d. All of the above
14. c. Both are correct. 35. d. All of the above 14. a. Planning the
15. b. In Life insurance 36. d. All of the above. priorities in life
policies, the 37. b. Provides easy 15. b. Very short term
coverage is liquidity of the goal
against the time of funds invested 16. d. To plan for buying
death 38. d. All of the above a washing
16. c. A person in the 39. c. Mutuality machine
age group of 21- 40. c. Even if the policy 17. b. Planning to go for
25 years holder stops holidays in the
17. a. Increase with paying premium, long weekend
increase in age has some residual 18. d. All of the above
18. d. All are correct value in the policy. 19. a. Learner
19. c. Both a and b are 41. d. All of the above 20. b. Earner
correct.

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