Quiz
PCIL sample question pt 1
Create a free account to finish this quiz
Save your progress and see your final score.
Already have an account? Sign in
Questions in this quiz (200)
11. What is the correct definition of a pure risk?
- Aa) A risk where there is only the possibility of a losses or break even outcome
- Bb) A risk that only affects individuals as opposed to society as a whole
- Cc) A risk that cannot be measured in financial terms
- Dd) A risk where there is a possibility of financial gain
22. Which of the following is NOT a characteristic of an insurable risk?
- Aa) It should not be against public policy
- Bb) It must be fortuitous or accidental in nature
- Cc) It must be a speculative risk
- Dd) Homogenous exposures with the same expectation of loss
33. Which of the following is NOT a benefit of insurance?
- Aa) Peace of mind
- Bb) Means of saving
- Cc) Return on investments
- Dd) Investment of funds
44. Which of the following is the least effective approach to handling risks?
- Aa) Avoiding the risk
- Bb) Transferring the risk
- Cc) Retaining the risk
- Dd) Ignoring the risk
55. For insurance purposes, fire damage is classified as
- Aa) A speculative risk
- Bb) A fundamental risk
- Cc) A pure risk
- Dd) A physical hazard
66. Which of the following descriptions is incorrect?
- Aa) Peril is the prime cause of a loss
- Bb) Hazard will increase the chance of a loss
- Cc) Uncertainty regarding loss is often termed as risk
- Dd) Moral hazard is identified by the physical characteristics of the risk
77. Which of the following is NOT a risk covered by insurance?
- Aa) Death due to sickness or illness
- Bb) Liability to consumers arising from the sale of products
- Cc) Financial loss due to a drop in the share price
- Dd) Damage to vehicle as a result of a chain collision
88. What is the difference between life and general insurance?
- Aa) Both provide financial protection
- Bb) Life insurance is long term whereas general is yearly renewable
- Cc) Life insurance offers financial security after retirement and in old age
- Dd) General insurance covers risks other than life insurance
99. What type of insurance operation is Lloyd’s of London?
- Aa) A proprietary insurance company
- Bb) A mutual insurance company
- Cc) A society of underwriters
- Dd) A protection and indemnity club
1010. What is meant by a composite insurance company?
- Aa) A company consisting of a head office and regional branches
- Bb) A company formed under the Companies Act
- Cc) A company writing both life and general insurance business
- Dd) A company that specialises in writing a single class of business
1111. The proximate cause of a loss is always
- Aa) the dominant cause.
- Bb) the cause nearest the loss in time.
- Cc) the cause nearest the loss in distance.
- Dd) an insured peril.
1212. Why do insurers insert a subrogation condition in their policies?
- Aa) To give them the right to pursue a recovery action against a responsible party
- Bb) To allow them to commence a recovery action before they pay a claim
- Cc) To allow them to pursue a recovery action In their own name
- Dd) To prevent the insured from claiming twice for the same loss
1313. Which principle is a corollary of indemnity and gives the insurer the right to call on other insurers similarly liable to pay part of a claim?
- Aa) Proximate cause
- Bb) Subrogation
- Cc) Contribution
- Dd) Insurable interest
1414. How is indemnity measured under property insurance policies?
- Aa) According to a formula
- Bb) On agreed value basis
- Cc) On a reinstatement basis
- Dd) On a first loss basis
1515. For a life insurance policy to be valid, when must insurable interest exist?
- Aa) At the inception of the policy only
- Bb) At the time of a claim
- Cc) At the inception of the policy and at the time of a claim
- Dd) At the inception of the policy or at the time of a claim
1616. What is meant by a ‘consumer insurance contract’ as defined under schedule 9 of the Financial Services Act 2013?
- Aa) A contract entered by a consumer of lie and general insurance
- Bb) A contract entered by an individual not related to his trade, business, or profession
- Cc) An insurance contract entered into by a homeowner
- Dd) Insurance policies bought by consumers in general
1717. What distinguishes an uninsured peril from an excluded peril?
- Aa) An excluded peril is uninsurable.
- Bb) An uninsured peril can be covered with additional premium but an excluded peril is more appropriately covered by some other policy.
- Cc) An uninsured peril can be included by removing the exclusion clause.
- Dd) An uninsured peril is lower risk compared to an excluded peril.
1818. When does the right of an insurer to repudiate liability arise in the event that a prospective policy owner failed to disclose relevant information that would affect the decision to accept or reject the risk?
- Aa) At pre-contractual stage
- Bb) During the currency of the policy
- Cc) At the time of a claim
- Dd) At renewal stage
1919. Which remedy is not available to the insurer if there was fraudulent breach of good faith by the insured?
- Aa) Avoid the policy as a whole
- Bb) Avoid the policy and keep the premium
- Cc) Ignore the breach and allow the policy to stand
- Dd) Refuse a particular claim but allow the policy to stand
2020. Which one of the following has no insurable interest in the life of another?
- Aa) Child dependent on a parent
- Bb) Employer on an employee’s life
- Cc) Principal on an agent’s life
- Dd) Legal guardian on a minor’s life
2121. Which of the following is NOT a function of Bank Negara Malaysia?
- Aa) Enhance professional standards and business conduct of the agency force
- Bb) Faster fair, responsible and professional business conduct of insurance companies
- Cc) Strive to protect the rights and interests of financial consumers
- Dd) Keep a close watch on solvency and market conduct of the insurance industry
2222. Which new legislation replaced the Insurance Act of 1996?
- Aa) Islamic Financial Services Act 2013
- Bb) Financial Services Act 2013
- Cc) Insurance Act 2013
- Dd) Financial Services Authority 2013
2323. Which of the following is NOT true of the Risk-Based Capital (RBC) framework?
- Aa) Determines the capital adequacy ratio of insurance companies
- Bb) Preserves the valuation surplus of the participating life insurance fund
- Cc) Ensures capital in available to protect policyholders against insolvencies of insurers
- Dd) Ensures fair and equitable premium rates charged by insurers
2424. Which of the following is NOT a complaint or dispute resolution mechanism for financial consumers?
- Aa) Financial Mediation Bureau (FMB)
- Bb) Complaints Unit of an insurance company
- Cc) Malaysia Competition Commission (MyCC)
- Dd) BNMLINK
2525. On whom is Customer Due Diligence (CDD) to be conducted as required by the Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) guidelines?
- Aa) Insurance intermediary or agent
- Bb) Financial Institutions
- Cc) Customer and its Beneficial Owner
- Dd) Financial Consumer
2626. Which of the following is NOT considered ‘personal data’ by the Personal Data Protection Act 2010?
- Aa) Any personal information in respect of commercial transactions
- Bb) Personal information posted on social media
- Cc) Sensitive personal data e.g. physical or mental health, political opinions, religious beliefs, offences or any other data as the Minister may determine
- Dd) Expression of opinion about the data subject
2727. Which types of complaints are handled by the Financial Mediation Bureau (FMB)?
- Aa) Complaints involving pricing of insurance products and underwriting issues
- Bb) Fraud cases (other than payment instruments such as credit cards, charged cards and cheques amounting to more than RM25,000)
- Cc) Cases involving claims below RM 200,000 for motor and fire insurance policies
- Dd) Cases that have been or are being referred to the court or arbitration
2828. Who administers the Takaful and insurance Benefits Protection System (TIPS)?
- Aa) Financial Consumer Protection
- Bb) Bank Negara Malaysia (BNM)
- Cc) Insurance Companies and Takaful Operators
- Dd) Malaysia Deposit Insurance Corporation (PIDM)
2929. Under the Financial Services Act 2013 ‘authorized business’ licensed by the Minister include the following EXCEPT:
- Aa) insurance business
- Bb) insurance broking
- Cc) insurance loss adjuster
- Dd) financial advisory business
3030. Which law requires an insurance company to be incorporated as a public company and a broker, financial adviser and loss adjuster to be incorporated as a private company?
- Aa) Companies Act 1965
- Bb) Financial Services Act 2013
- Cc) Insurance Act 1996
- Dd) Competition Act 2010
3132. What is the operative clause of an insurance policy?
- Aa) The clause that describes what the insured must do in the event of claim
- Bb) The clause that describes or refers to the cover provided by the insurers
- Cc) The clause that describes the risks excluded from the policy cover
- Dd) The operating clause that refers to the proposal, the parties, and the premium
3233. Which of the following does NOT make an insurance contract void?
- Aa) No insurable interest at the time of effecting the policy
- Bb) No consensus or a fundamental mistake or disagreement from the start
- Cc) Fraudulent misrepresentation or concealment at the pre-contractual stage
- Dd) Innocent misrepresentation at the time of filling up the proposal form
3334. Which of the following have the capacity to contract?
- Aa) Minors
- Bb) A person above the age of 18
- Cc) People who are mentally ill or drunk
- Dd) Corporations
3436. What is a voidable contract?
- Aa) A breach of contract by one or both parties
- Bb) A fundamental mistake rendering the contract void
- Cc) A contract which is binding but the party has the right to set it aside
- Dd) One party’s legal incapacity to enter a contract
3537. Which of the following is NOT normally found in the Schedule of policy?
- Aa) Name and address of the insured
- Bb) Period of insurance
- Cc) Amount of premium
- Dd) Exclusions
3638. Which of the following best describes an unenforceable contract?
- Aa) Legally binding even if one party refuses to keep to the agreement
- Bb) A valid contract but cannot be enforced in a court
- Cc) A valid contract which is not illegal
- Dd) A legal contract which is not binding
3739. What is meant by consideration in relation to an insurance contract?
- Aa) Cover note in return for proposal for insurance
- Bb) Premium payable in return for cover provided
- Cc) Payment of claim in return for premium paid
- Dd) A promise to pay the sum assured.
3840. Which rule of law governs contracts in Malaysia?
- Aa) Sales of Goods Act 1965
- Bb) Financial Services Act 2013
- Cc) Contracts Act 1950
- Dd) Insurance Act 1996
3941. Which of the following is NOT true about the role of an insurance agent?
- Aa) Responsible for the sales of insurance products and services
- Bb) Considered to be the agent of the insurer and bound to the insurer he represents
- Cc) Represents many insurers and shops for an insured
- Dd) Assists the insurer in submitting covered claims for payment
4043. Under what circumstances, if any, can an agent delegate a task to someone else?
- Aa) Under no circumstances. An agent must always perform his duties and tasks personally
- Bb) Where the agent has the status of a del credere agent
- Cc) Where the work delegated is purely clerical
- Dd) Where the sub-agent has himself acted as an agent for the principal in a previous transaction
4145. Which of the following statements describes and agent’s right to indemnity?
- Aa) If an agent does what is asked of him under the agreement, he has the right to be paid for his services.
- Bb) If an agent arranges an insurance contract on behalf o his principal, both agent and principal are entitled to indemnity under the contract.
- Cc) If an agent expends money in the course of his duties, he is entitled to be reimbursed by his principal.
- Dd) If an agent commits the principal to expenditure under the contract, the agent is liable if the principal fails to pay.
4247. In which situation here is the agent working for the insurer and NOT the customer?
- Aa) Agent seeks a quotation for an insurance policy
- Bb) Agent relays the price quoted by underwriters to the customer
- Cc) Agent confirms to the underwriter that the quotation has been accepted
- Dd) Agent collects the premium from the customer and passes it on the insurer
4348. Which of the following statement is NOT true about actual authority?
- Aa) Actual authority may be express or implied
- Bb) Express actual authority may be oral or in writing
- Cc) Authority that may appear to be apparent
- Dd) Implied actual authority is also termed usual authority or customary authority
4449. An insurance agent is a person who does any of the following EXCEPT
- Aa) Act on behalf of an insurer in the issuance, renewal or continuance of a policy
- Bb) Arrange an insurance contract on behalf of his principal
- Cc) Delegate his duties to a sub-agent
- Dd) Act on behalf on an insurer in negotiating policy terms
4550. Which of the following is NOT a valid remedy for a principal if the agent falls in his duties?
- Aa) Sue the agent for damages for breach of contract
- Bb) Terminate the insurance policies sold by the agent
- Cc) Dismiss the agent without notice or compensation for a serious breach
- Dd) Rescind any contract made through the agent and refuse commissions if the breach is fraudulent
4651. Which of the following events does NOT automatically terminate a medical and health insurance policy?
- Aa) Exhaustion of the annual limit or lifetime limit stipulated in the policy
- Bb) The anniversary date following the insured’s maximum eligibility age
- Cc) Breach of a policy condition
- Dd) The death of an insured person
4753. Which of the following is NOT a Medical and Health insurance Product?
- Aa) Hospital and surgical insurance
- Bb) Critical illness or dread disease insurance
- Cc) Permanent disability income
- Dd) Disability income insurance
4854. Which of the following is NOT an option with the renewal of a medical and health insurance policy?
- Aa) Notify the insured that renewal is on a level premium
- Bb) Notify the insured that renewal is with an increased premium
- Cc) Notify the insured 30 days before the policy anniversary that policy is not renewed
- Dd) Refuse to renew a policy that is guaranteed renewable
4955. What benefits are payable under a hospital income insurance policy?
- Aa) Income stream to replace a portion of the pre-disability income if insured is not able to work due to illness
- Bb) Fixed allowance on regular intervals due to hospitalisation caused by illness or injury
- Cc) Reimbursement of medical expenses due to hospitalisation caused by illness or injury
- Dd) Lump sum payment of sum insured upon diagnosis of any of the 36 dread diseases
5056. What is the best option available to an insurer in dealing with a previous claim under an existing medical and health insurance policy?
- AImpose more restrictive terms and limitations
- Bb) Specifically exclude the condition or disability which gave rise to a previous claim
- Cc) Refuse to renew cover because the policy owner has made a claim in the preceding year
- Dd) Charge extra premium loading and surcharge
5157. What was the main purpose of the revised Guidelines on Medical and Health Insurance Business?
- Aa) To increase premium rates on higher-risk individuals
- Bb) To reduce escalating claim costs
- Cc) To prescribe minimum standards to be observed by life and general insurers
- Dd) To introduce new limitations on core benefits
5258. Which of the following is NOT a role of Managed Care Organisations (MCOs) in Malaysia?
- Aa) Administer hospital admission and discharge for HIS policies
- Bb) Approve and settle MHI claims promptly on behalf of the insurer
- Cc) Administer MHI claim transactions between policyholders and health care providers
- Dd) Ensure utilisation of medical services conform to clinical-based standards
5359. Why is it important to use standard definitions for key policy terms and conditions in MHI policies?
- Aa) To promote competition in product pricing
- Bb) To minimise public confusion and facilitate comparison between products
- Cc) To unilaterally exclude pre-existing conditions from policies
- Dd) To enhance customer service and marketing of health products.
5460. Which of the following circumstances does NOT require further medical investigations and/or documentation in underwriting medical and health insurance?
- Aa) An impaired risk with adverse medical history
- Bb) A pre-existing condition which increases the probability of a recurrence
- Cc) A medical condition which is capable of prolonging the recovery period
- Dd) An accidental injury which had caused temporary disablement
5561. A life claim can arise under any of the following situations, EXCEPT:
- Aa) death of the insured
- Bb) death of the beneficiary
- Cc) maturity of the life policy
- Dd) critical illness
5662. In the case of a missing person, what is the time lapse before a statutory presumption of death can be issued by a court?
- Aa) 1 year
- Bb) 3 years
- Cc) 5 years
- Dd) 7 years
5764. A death claim must be paid within _____ days of receipt of notification of the claim; otherwise the law requires compound interest to be charged on the amount payable.
- Aa) 15 days
- Bb) 30 days
- Cc) 60 days
- Dd) 7 days
5866. Before a maturity claim under endowment insurance is paid the life insurer requires proof of the following, EXCEPT:
- Aa) proof of age of the life assured
- Bb) proof of death of the life assured
- Cc) identity of the person entitled to the policy monies
- Dd) proof of survival of the life assured
5967. Where there is a nomination in a life policy, who will receive the policy monies?
- Aa) Policy owner
- Bb) Spouse, child or parent
- Cc) Nominee
- Dd) Estate of the deceased
6068. The following documents are required for a total and permanent disability claim due to an accident, EXCEPT:
- Aa) a duly completed claim form
- Bb) a certified copy of the police report
- Cc) a medical certification by the attending doctor
- Dd) a certified copy of the attending doctor’s credentials
6169. Where the policy owner dies without having made a nomination, the insurer shall pay the policy monies to the
- Aa) lawful executor or administrator of the deceased’s estate
- Bb) policy owner’s spouse, child or parent
- Cc) nominee
- Dd) policy owner’s next of kin
6271. Which of the following is NOT an underlying principle of the Code of Ethics for insurance agents?
- Aa) To avoid conflicts of interest
- Bb) To avoid misuse of position
- Cc) To prevent transmission of information
- Dd) To ensure completeness and accuracy of relevant records
6372. Which of the following statements is true pertaining to the Code of Practice for Life Insurance Agents?
- Aa) It provides a guide to conduct business with utmost good faith and integrity
- Bb) It provides guidelines on how to run a business on a day-to-day basis
- Cc) It provides a guide to assist in the sale and marketing of insurance product
- Dd) It provides a guide to the claims process
6473. When selling insurance, what should the agent refrain from doing?
- Aa) Ensure unsolicited or unarranged calls are made at a time suitable to the client
- Bb) Inform the client outright of his intention to discuss matters relating to insurance
- Cc) Give specialist advice on insurance and all other matters in order to impress his client
- Dd) Ensure that the policy proposed is suitable to the needs and resources of the prospective policyholder
6574. Which of the following statements is true about an insurance agent?
- Aa) The agent solicits or negotiates a contract of insurance as an agent of the insured
- Bb) The agent gives specialist advice on financial matters to his prospective policyholder
- Cc) The agent ensures that the life policy is best suited to the needs and resources of the prospective policyholder
- Dd) The agent recommends the best life policy at the lowest premiums available in the market
6675. The insurance agent should NOT:
- Aa) Inform the prospective policyholder that his name was given by another person, unless he is prepared to disclose that person’s name if requested to do so by the prospective policyholder and has that person’s consent to make the disclosure
- Bb) Make, issue or cause any written or oral statement misrepresenting or making misleading unfair or biased comparison regarding the terms conditions or benefits in any policy
- Cc) Prevent the prospective policyholder from stating material facts to the insurance company or induce the person not to state them
- Dd) a) and c)
6777. An insurer is not expected to reject a claim if the life policy has been in force for a period of more than two years unless:
- Aa) there was no insurable interest at the time of claim
- Bb) there was misstatement of age a inception of the policy
- Cc) there is proof of fraudulent misrepresentation or concealment
- Dd) there was innocent misrepresentation when completing the proposal form
6878. What is the extent of the agent’s authority in collecting monies on behalf of this principal?
- Aa) Handle all financial transactions with a prospective policyholder and give an account only when asked to do so
- Bb) Acknowledge receipt and keep a proper account of all monies received in connection with an insurance policy
- Cc) Transmit all monies collected to the insurer’s bank account when it is convenient to do so
- Dd) Use the money collected for personal use until such time the premiums are due for payment
6979. What issues must be drawn to the client’s attention in trying to explain the main provision of the insurance contract?
- Aa) The basic cover provided by the policy
- Bb) The policy exclusions, extra charges imposed and purpose of such charges
- Cc) The cooling-off period when the insured can object to any provisions in the policy
- Dd) The agent’s contact details if after sales service is required by the client
7081. Which of the following statements is NOT true concerning life insurance premiums?
- Aa) Premium rating tables are designed in accordance with age and term of insurance.
- Bb) Net premium is pure risk premium for mortality plus an element of interest added to it.
- Cc) Gross premium is the net premium plus a loading for management expenses and profit.
- Dd) Participating life insurance policies will not be charged extra premium or loading.
7182. What is the method of charging a uniform premium throughout the duration of a life insurance policy despite the rate of death increasing with age?
- Aa) Level payment system
- Bb) Level premium system
- Cc) Increasing premium system
- Dd) Decreasing term assurance
7283. The expenses of running an insurance business can be categorised into three types EXCEPT
- Aa) Initial expenses
- Bb) Renewal expenses
- Cc) Termination expenses
- Dd) Procurement expenses
7384. Which of the following is NOT a major factor influencing mortality?
- Aa) Age
- Bb) Gender
- Cc) Ethnicity
- Dd) Accidents
7485. How much is the personal tax relief for the purchase of life insurance including contributions to the Employees Provident Fund (EPF)?
- Aa) RM 3,000
- Bb) RM 4,000
- Cc) RM 5,000
- Dd) RM 6,000
7587. Which of the following best describes a life insurance contract?
- Aa) short term and renewable
- Bb) investment and saving plan
- Cc) long term and permanent
- Dd) long term and renewable
7688. Which of the following underwriting factor is NOT associated with physical hazard?
- Aa) Height and weight
- Bb) Family medical history
- Cc) Earning capacity
- Dd) Lifestyle
7789. Why do insurance companies charge a loading for payment of bonus for participating policies?
- Aa) To pay bonus to employees and shareholders
- Bb) To increase the profits of the company
- Cc) To ensure adequate premium is charged for the risk
- Dd) To allow participating policyholders a share in the profits of the company
7890. The premium rates for group life insurance
- Aa) Are based on the mortality rate using burning cost method.
- Bb) Are based on the experience rated using the average mortality rate.
- Cc) Are based on the level premium system using mortality rate.
- Dd) Are based on the past claims experience of the group.
7991. An underwriter is best described as an insurance professional who
- Aa) accepts or rejects risks.
- Bb) implements and insurer’s strategic plan.
- Cc) invests the capital of an insurer’s shareholders.
- Dd) decides on premium pricing.
8092. Which of the following is an indication of a soft market?
- Aa) Rising premiums
- Bb) A reduction in market capacity
- Cc) Premium rates are below profitable levels
- Dd) The rejection of normally acceptable risks
8193. A sub-standard or below average risk is best described as
- Aa) An acceptable risk on standard terms and premium rates.
- Bb) A risk with health or occupational hazards accepted on special terms.
- Cc) Not acceptable on any account.
- Dd) An uninsurable risk, such as a person with terminal illness.
8294. Which of the following is NOT part of the underwriting process?
- Aa) Establishing policy coverage terms and conditions
- Bb) Evaluating, assessing, and selecting of risks for insurance
- Cc) Establishing claim procedure and documentation
- Dd) Pricing of insurance to charge premium commensurate with risk
8395. What is the purpose of financial underwriting in life insurance?
- Aa) To evaluate the physical hazard of an applicant for life insurance
- Bb) To assess the moral hazard attached to a potential customer
- Cc) To select customers of sound financial status to pay premiums
- Dd) To ensure the purchaser has insurable interest in the life insured
8496. Which of the following documents is a major source of information for underwriting insurance?
- Aa) Proposal form
- Bb) Financial report
- Cc) Agent’s report
- Dd) Sales illustration
8597. What is the role of the insurance agent in the underwriting process?
- Aa) Assists the underwriter in calculating the premium payable
- Bb) Offers financial advice to potential customers
- Cc) Assists in filling up the proposal form for the customer
- Dd) Ensures all material facts are disclosed so that both customer and underwriter make an informed decision
8698. When can a life insurer assume a risk for life insurance?
- Aa) On receipt of the first premium after a letter of acceptance is issued
- Bb) On receipt of a completed proposal form
- Cc) After the underwriter has assessed the information in the proposal form
- Dd) After the policy is issued and/or delivered to on the policy owner
8799. What is meat by ‘cooling off’ or ‘free look’ period.?
- Aa) It allows a policyholder to cancel the life policy after 15 days of free cover
- Bb) It allows a policyholder to return the life policy within 15 days for a full refund.
- Cc) It allows a policyholder to reject the life policy after 15 days of free cover.
- Dd) It allows a policyholder to cancel the life policy not later than 15 days after its delivery.
88101. In the case of a missing person, what is the time lapse before a statutory presumption of death can be issued by a court?
- Aa) 1 year
- Bb) 3 years
- Cc) 5 years
- Dd) 7 years
89111. Which of the following is NOT an underlying principle of the Code of Ethics for insurance agents?
- Aa) To avoid conflicts of interest
- Bb) To avoid misuse of position
- Cc) To prevent transmission of information
- Dd) To ensure completeness and accuracy of relevant records
90112. Which of the following statements is true pertaining to the Code of Practice for Life Insurance Agents?
- Aa) It provides a guide to conduct business with utmost good faith and integrity.
- Bb) It provides guidelines on how to run a business on a day-to-day basis.
- Cc) It provides a guide to assist in the sale and marketing of insurance products.
- Dd) It provides a guide to the claims process.
91113. When selling insurance, what should the agent refrain from doing
- Aa) Ensure unsolicited or unarranged calls are made at a time suitable to the client
- Bb) Inform the client outright of his intention to discuss matters relating to insurance
- Cc) Give specialist advice on insurance and all other matters in order to impress his client
- Dd) Ensure that the policy proposed is suitable to the needs and resources of the prospective policyholder
92115. Which of the following statements is true about an insurance agent?
- Aa) The agent solicits or negotiates a contract of insurance as an agent of the insured.
- Bb) The agent gives specialist advice on financial matters tohis prospective policyholder.
- Cc) The agent ensures that the life policy is best suited to the needs and resources of the prospective policyholder.
- Dd) The agent recommends the best life policy at the lowest premiums available in the market.
93117. What is the extent of the agent’s authority in collecting monies on behalf of his principal?
- Aa) Handle all financial transactions with a prospective policyholder and give an account only when asked to do so.
- Bb) Acknowledge receipt and keep a proper account of all monies received in connection with an insurance policy.
- Cc) Transmit all monies collected to the insurer’s bank account when it is convenient to do so
- Dd) Use the money collected for personal use until such time the premiums are due for payment
94118. What issues must be drawn to the client’s attention in trying to explain the main provisions of the insurance contract?
- Aa) The basic cover provided by the policy
- Bb) The policy exclusions, extra charges imposed and purpose of such charges
- Cc) The cooling-off period when the insured can object to any provisions in the policy.
- Dd) The agent’s contact details if after sales service is required by the client.
95119. An insurance agent is expected to be diligent in his practice of the following EXCEPT
- Aa) Prevent misuse of information.
- Bb) Ensure the proposal form is completed in his own handwriting
- Cc) Ensure confidentiality in all communication and transactions.
- Dd) Ensure fair and equitable treatment of all policy owners..
96120. An insurer is not expected to reject a claim if the life policy has been in force for a period of more than two years unless:
- Aa) There was no insurable interest at the time of claim.
- Bb) There was misstatement of age at inception of the policy.
- Cc) There is proof of fraudulent misrepresentation or concealment.
- Dd) There was innocent misrepresentation when completing the proposal form.
97122. Which of the following is the correct description of an Investment-Linked Life Insurance policy?
- Aa) A participating policy offering lifetime coverage
- Bb) A capital guaranteed policy
- Cc) An endowment policy which provides minimum returns
- Dd) A policy offering protection while also investing in funds which form the basis for returns to the policy owner
98127. An example of investment in Money Market is
- Aa) 5-Year Bond.
- Bb) Currencies and Forex.
- Cc) Treasury Bills.
- Dd) Saving Account.
99130. When an investment-linked policy reaches maturity, the maturity value will be
- Aa) the basic sum assured and the account value.
- Bb) the account value.
- Cc) the account value plus terminal/maturity bonus.
- Dd) the basic sum assured and the account value plus terminal/maturity bonus.
100131. A female, aged 30 years, has budgeted to set aside RM3,000 a year for a basic regular premium Investment-Linked Life Insurance plan with a Unit-Deducting Hospitalization Rider. According to the SAM formula, the multiple factor for her age is 50 times. How would you calculate the minimum sum assured for the basic plan?
- Aa) RM3,000 minus the notional premium for the rider, multiply by 50.
- Bb) RM3,000 multiply by 50.
- Cc) RM3,000 multiply by 55 times.
- Dd) RM3,000 minus the notional premium, then multiply by 55 times.
101132. An example of investment in Money Market is
- Ae) 5-Year Bond.
- Bf) Currencies and Forex.
- Cg) Treasury Bills.
- Dh) Saving Account.
102135. The main purpose of an agent conducting a risk profile on his potential client is
- Aa) to assess whether the potential client is willing to use a major portion of his savings or liquid assets to purchase a large investment=linked plan.
- Bb) to help the potential client understand his own risk profile, i.e. whether he has conservative, aggressive or balanced risk characteristics, and also to consider the type of asset categories suitable for his profile.
- Cc) to assess whether the potential client will be attracted to the product(s) being offered.
- Dd) to assess whether the potential client is willing to forego some of his existing liquid assets in order to buy an investment=linked product.
103137. Single premium investment-linked insurance is said to be more inclined towards investment than protection because
- Aa) generally, about 95% of the single premium is allocated for investment in fund units.
- Bb) the policy owner has the discretion to opt out of any protection coverage so that no cost of insurance will be deducted from the account value.
- Cc) the usual sum assured is 25% above the single premium outlay and may be lowered to 5% above the premium for older age groups, i.e. rm125,000 for sp of rm100,000, rm105,000 for senior ages with the same premium.
- Dd) once the account value exceeds the basic sum assured, the death benefit will be the account value, not inclusive of the sum assured.
104139. Which of the following statements is correct?
- Aa) Diversification means spreading out investment in different asset categories or fund
- Bb) Diversification not only means spreading out investment in different asset categories or fund types, but also acquiring various assets of the same category or fund type.
- Cc) Investment-linked funds in Malaysia confine the investment diversification t assets in the country as a way of discouraging the outflow of funds.
- Dd) When the stock market shows sighs of going up, an investor should give key focus to leverage the market trend and switch all fixed income or bond assets to equities.
105146. Which statement below explains what a simple (current) net worth analysis involves?
- Aa) The forecast of a person’s future net wealth and financial status (e.g. middle income, upper middle income, etc.)
- Bb) A calculation of the sum of assets in current monetary terms that a person presently owns, not including any future inheritance
- Cc) The total sum of all assets owned by a person in present value minus the existing total sum of all liabilities he is obliged to settle. The balance, if any, is his present net worth to his family in the event of his early demise.
- Dd) A personal plan outlining the targets for values of current and future assets to be achieved at certain time in the future.
106150. Which of the statements below is incorrect?
- Aa) Sukuk are like bonds but they are based on Shariah-compliant principles.
- Bb) Malaysia is the world’s largest issuer of sukuk.
- Cc) Sukuk securities are issued by Malaysia in Ringgit only.
- Dd) Sukuk securities issued by Malaysia can be in USD.
107155. Which of the following statements about Real Estate Invest Trusts (REITs) is NOT true?
- Aa) REITs operate in a way similar to unit trusts.
- Bb) Rental income from the properties invested by a REIT is distributed to investors in the form of dividend.
- Cc) A REIT can invest in a wide range of properties like malls, office blocks, apartments, commercial lots, hotels, etc
- Dd) REITs may acquire shares in property development companies.
108162. Valuation of units in an investment-linked fund must be done
- Aa) Six days in a week, including Saturdays (half day).
- Bb) Every business day.
- Cc) Every day.
- Dd) Seven days a week. For a day that falls on a weekend or a public holiday, valuation processed by the automated system will be based on the same unit price as the previous business day.
109164. The guidelines stipulated by the regulatory authority in allowing a life insurer to undertake unit splits for an investment-linked fund once a year is on the condition that “there is sustainable appreciation on net asset value (account value) over a six-month period preceding the split.” Which of the statements below is correct regarding the above statement?
- Aa) This means that appreciation over the 6-month period must be considered substantial by reasonable standard compared to the previous 6 months.
- Bb) This refers to an appreciation rate of at least 20% at the end of the current 6 months over the previous 6 months.
- Cc) This refers to an increase in the average monthly net asset value (account value) consecutively for 6 months.
- Dd) This means that the discretion to define “sustainable appreciation” may lie with the life insurer as long as there is growth in the fund in the prevailing 6 months over the previous 6 months, subject to the approval of the board of directors.
110165. Since part of the initial premium of a regular premium investment-linked plan may already have been allocated and invested to acquire fund units by the time the customer decides not to take the plan within the 15 days free-look period, in what manner will the refund be made?
- Aa) Refund of full initial premium
- Bb) Refund of full initial premium minus policy fee and medical examination expenses (if any) incurred by the life insurer
- Cc) Refund of unallocated premium + net asset value (account value) at next valuation date + insurance charges and policy fee already deducted - medical examination fees it any
- Dd) Refund of unallocated premium + net asset value (account value) – cost of insurance and policy fee – medical examination fees if any
1111. Adam was killed while robbing a goldsmith shop. When his nominee filed a claim for death benefit under a personal accident policy, the insurer
- Aa. he died while committing an illegal act
- Bb. there was no consideration1
- Cc. there was no intention to create a legal relationship
- Dd. there was no offer and acceptance
1122. What is a speculative risk?
- Aa. A risk with possibility of profit, loss or no loss
- Bb. A risk with possibility of loss or no loss only
- Cc. A risk which is insurable
- Dd. A risk with possibility of loss or a gain only
1133. Which of the following is NOT an example of moral hazard?
- Aa. Carelessness
- Bb. Dishonesty
- Cc. The construction of a building
- Dd. Unreasonableness
1145. Why are only pure risk insurable?
- Aa. Because of the principles of utmost good faith
- Bb. Because insurers prefer good risks only
- Cc. Because there is no possibility of a loss
- Dd. Because of the need to maintain the principles of indemnify
1156. The function of the Financial Mediation Bureau (FMB) is to….
- Aa. serve as a central registry for all health policies issued on a medically sub-standard
- Ba. inform its members of specific underwriting actions taken by its members
- Cc. provide an independent service for dealing with disputes between insurers and personal
- Dd. assist its members in detecting non-disclosures of facts by applicants
1168. The principle of contribution arises most commonly in_________ insurances.
- Aa. fire
- Bb. sickness
- Cc. personal accident
- Dd. All of the above
1179. Under a group medical and health insurance scheme, the parties to the contract are
• the employer and the insurer
• the employees, the employer and the insurance company
• the beneficiary, the employees, the employer and the insurance company- Aa. 5
- Bb. 2
- Cc. 3
- Dd. 4
- Ee. the employees and the employer
11810. The common health insurer underwriting decisions are…
- Aa. Standard (issued exactly as applied for), postponed, change plan
- Bb. Standard (issued exactly as applied for), postponed, sub-standard (issued on other than applied for basis)
- Cc. Standard (issued exactly as applied for), declined, sub-standard (issued on other than applied for basis)
- Dd. Standard (issued exactly as applied for), declined, postponed
11911. Which of the following is NOT a non-forfeiture provision?
- Aa. Paid-up policy
- Bb. Automatic premium loan
- Cc. Instalment payment over a fixed period
- Dd. Extended term insurance
12012. A life policy shall NOT be invalidated by reason of only
- Aa. Misrepresentation of medical history
- Bb. Misrepresentation of condition of health
- Cc. Non-disclosure of hazardous hobbies
- Dd. Misstatement of age
12114. What is insurance?
- Aa. A method of selling a tangible product
- Bb. A method of collecting contributions from members for investment
- Cc. A method of reducing losses and their subsequent occurrence
- Dd. A risk transfer mechanism
12218. What is guaranteed under an investment-linked policy?
- Aa. The annual investment income
- Bb. The fixed value of units
- Cc. The investment under property fund
- Da. The sum assured
12319. From the statements about the similarities and differences between single premium invested-linked insurance (SP-IL) and unit trust (UTs)… true.
- Aa. Fund switching is allowed for both UTs and SP-IL
- Bb. EPF withdrawal is allowed for investment in both UTs and SP-IL
- Cc. Cost of insurance only applicable to SP-IL
- Dd. A policy fee is charged only in the case of SP-IL
12420. Many policies contain a provision that the policy shall not immediately lapse for non-payment of premium if it has acquired a …
- Aa. Non-lapse value
- Bb. Cash Value
- Ca. Policy loan
- Dd. Letter of non-lapse provision
12521. In which of the following situations does insurable interest NOT exist?
- Aa. A brother insuring the life of his sister
- Bb. A husband insuring the life of his wife
- Cc. A father insuring the life of his child
- Dd. A creditor insuring the life of his debtor
12622. The correct order of the selling process is:
- Aa. Locating the prospect, Conducting the sales interview, Making the sales presentation, Handling objections, Closing the sale
- Bb. Locating the prospect, Handling objections, Conducting the sales interview, Making the sales presentation, Closing the sale
- Cc. Locating the prospect, Making the sales presentation, Conducting the sales interview, Closing the sale, Handling objections
- Dd. Locating the prospect, Making the sales presentation, Conducting the sales interview, Handling objections, Closing the sale
12723. The Financial Services Act 2013 (FSA) replaces the
- Aa. Takaful Act 1984
- Ba. Insurance Act 1996
- Cc. Islamic Banking Act 1983
- Dd. Companies Act 1965
12824. If death occurs accidentally or suddenly without a known cause or prior medical attention, which of the following is among the documents that can be used
- Aa. Medical certificate
- Bb. Post-mortem report
- Cc. Certificate of death
- Dd. Statutory declaration
12925. A breach of utmost good faith by the insured
- Aa. Has no effect on the contract
- Bb. Renders the contract voidable
- Cc. Make the agent liable
- Dd. Has no effect on the contract and makes the agent liable.
13026. A life insurance policy is NOT considered a contract of indemnify because the
- Aa. Contract provides for a capital sum assured payable in the event of an insured event occurring
- Ba. Insurance covers a contingency which is not certain to occur at any time in the future
- Cc. Value of the insured’s own life cannot be measured in terms of money
- Dd. Sum assured involves a large amount of money
13128. The four main classes of health insurance contract are…
- Aa. Disability income, hospital income insurance, medical expenses and critical illness insurance
- Bb. Home service, clinical, maternity and dental insurance
- Cc. Medical expenses, disability income, home service and critical illness insurance
- Dd. Dental, medical expenses, maternity and home service insurance
13229. In the law of agency, an agent is a person who acts on behalf of another person whom he represents is called the…
- Aa. Insured
- Bb. Broker
- Cc. Intermediary
- Dd. Principal
13330. Property which is partially saved from the loss or damage is called…
- Aa. Left over
- Bb. Partial loss goods
- Cc. Salvage
- Dd. Constructive loss
13431. Which of the following statements is NOT true about an insurance agent?
- Aa. Agents should obtain specialist advice (from experts or underwriters) to explain the scope of coverage, terms and conditions of the policy
- Bb. An agent solicits a contract of insurance for the purpose of the formation of the contract
- Cc. An agent sets the amount of premium to be paid
- Dd. Statements made by the agent shall be deemed to be statements made by the insurer
13532. Which type of shares is listed on the stock exchange and is available to ordinary investors?
- Aa. All public limited companies shares
- Bb. Private company shares
- Cc. Public limited company shares which meet the Exchange’s requirement
- Dd. Sole-proprietorship company shares
13634. The chance of dying in a year at a specified ages is commonly termed as rate of
- Aa. Interest
- Bb. Surviving
- Cc. Morbidity
- Dd. Mortality
13735. Which of the following investment vehicles is categorised as fixed income securities?
- Aa. Cash and deposit
- Bb. Corporate bond
- Cc. Unit trusts
- Dd. Shares
13836. Insurance companies can be classified as
- Aa. Life insurers
- Bb. General insurers
- Cc. Composite insurers
- Dd. All the above
13937. In the context of the law of contract, the term “caveat emptor” means
- Aa. Let the buyer beware
- Bb. Representation
- Cc. Let the seller beware
- Dd. Utmost good faith
14038. Conducting a _________ is/are vital before getting into any investment decision
- Aa. Cash flow analysis
- Bb. Net worth analysis
- Cc. Personal budget and cash flow analysis
- Dd. Cash flow analysis and net worth analysis
14139. Which section of the policy states that the proposal and declaration shall be the basis of the contract between the insured and the insurer?
- Aa. Attestation clause (forth the legal requirements the document must satisfy, states that those requirements have been met, and is signed by one or more witnesses)
- Bb. Recital clause (general idea about the contract to its reader)
- Cc. Representation clause
- Dd. Operative clause
14240. _________ is NOT essential for an insurance contract
- Aa. Consideration
- Bb. Ratification by a lawyer
- Cc. Consensus and idem
- Dd. Offer and acceptance
14341. This is a method of distributing surplus:
- Aa. Simple or compound reversionary bonuses
- Bb. Common and general bonuses
- Cc. Extra or surpluses bonuses
- Dd. Simple or compound interest bonuses
14443. What constitutes a consideration on the part of insurer in an insurance contract?
- Aa. The promise to collect premium from the insured
- Bb. The promise to collect premium from agents
- Cc. The promise that no accident will occur to the subject matter of insurance
- Dd. The promise to indemnify the insured
14545. Which of the following does NOT form part of the recital clause of an insurance policy?
- Aa. That the insured has paid or agreed to pay the premium
- Bb. A reference to the written proposal, declaration and any other statements made by the insured
- Cc. That the insured has proposed to the company
- Dd. The company’s name, address and place of incorporation
14646. What must all registered agents sign to ensure they conduct business with utmost good faith and integrity?
- Aa. A statutory declaration
- Bb. A health declaration
- Cc. The code of practice
- Dd. The agency agreement
14747. The type of policies that provide for a lump sum payment upon the claimant being diagnosed as having any one of the specified critical illness are known as…
- Aa. Permanent health insurance policies
- Ba. Investment-linked policies
- Ca. Critical illness policies
- Dd. Permanent disability insurance policies
14848. Identify the major difference an ordinary whole life and a limited payment whole life policy.
- Aa. Premiums on an ordinary whole life policy are payable for the remaining lifetime of the insured whilst premiums on a limited payment whole life policy are payable for a limited period.
- Bb. An ordinary whole life policy accumulates cash value faster than a limited payment whole life policy
- Cc. An ordinary whole life policy gives protection for a lifetime, while a limited payment policy provides protection for a limited period
- Dd. An ordinary whole life policy is non-participating whereas a limited payment whole life policy is participating
14949. The Guideline on Medical and Health Insurance Business (Revised) which came into effect 1 January 2006, aim to…
- Aa. Enhance consumer awareness and enable consumers to make informed decisions
- Bb. Promote more equitable and consistent treatment of consumers covered under MHI policies
- Cc. Provides specified benefits against risk of persons becoming totally or partially incapacitated
- Dd. To complement employees’ health benefit compensation package
15050. For single premium investment-linked life insurance, the shortfall between the account and sum assured is called….
- Aa. Cost of insurance
- Bb. Premium holiday
- Cc. Partial withdrawal
- Dd. Sum at risk
15152. The investment-linked insurance business is a contract of…
- Aa. Insurance providing like coverage and investment return
- Bb. Investment in properties
- Cc. Life insurance
- Dd. Investment in human life
15253. The administrative fee, insurance charge and fund management fee under an investment-linked life insurance policy are
- Aa. Guaranteed
- Bb. Always “up-front” charges
- Cc. Subject to change by insurance companies
- Dd. Not subject to review
15354. A principal-agent relationship CANNOT be created by the following ways:
- Aa. Revocation
- Bb. Apparent authority
- Cc. Consent
- Dd. Ratification
15456. Health insurers are very careful not to accept unhealthy persons at standard premium rates as these results in a less favourable underwriting result. This occurs when an applicant who knows that he has a very high probability of loss submits a proposal for health insurance. This situation is known as
- Aa. Averse selection
- Bb. Poor selection
- Cc. Anti-selection
- Dd. Risk selection
15557. Which of the following is NOT an option for the modification of medical and health policy benefits and coverage?
- Aa. Reduction of the amount of benefits payable
- Bb. Guaranteed renewal without premium review
- Cc. Shortening of the period of payment of disability income
- Dd. Imposition of a larger deductible
15658. Insurance brokers, financial advisers and registered adjusters are required to be incorporated as
- Aa. Public companies
- Bb. Unlimited companies
- Cc. Private companies
- Dd. Registered companies
15759. Decreasing term insurance is a form of term insurance in which
- Aa. The insurance cover will terminate when the insured reaches 50 years of age
- Bb. The sum insured reduces each year until a small or no cover remains at the end of the term
- Cc. The bonus reduces each year
- Dd. It can be converted to a whole life policy any time
15863. How does Perbadanan Insurans Deposit Malaysia (PIDM) complement the role of the Central Bank of Malaysia?
- Aa. By protecting financial consumers against unscrupulous agents
- Bb. By providing immediate resolution to customer complaints
- Cc. By providing a safety net for depositors and insurance policy owners in the event of insolvency
- Dd. By protecting insurance companies against financial losses
15964. In the context of taxation, what is the difference between the different types of investment?
- Aa. Only investment-linked life insurance investment portfolios are subject to taxation
- Bb. There is no difference
- Cc. There are no special tax laws relating to investment-linked life insurance products
- Dd. Different types of investment are taxed differently
16065. Which of the following is an INCORRECT description of implied actual authority?
- Aa. Doing anything which is incidental to the carrying out of the agent’s express instructions
- Bb. Performing those acts which are usually performed by persons in the agent’s position
- Cc. Acting in good faith and interpreting express instructions in a reasonable way
- Dd. Performing those acts which are usually performed or usual in a particular trade or profession
16166. The provision in a life policy which exempts a totally disabled insured from continuing with the payment of premium is known as the
- Aa. Guaranteed insurability benefit
- Bb. Paid up policy option
- Cc. Non-forfeiture benefit
- Dd. Waiver of premium for disability benefit
16268. An insurance agent who solicits or negotiates a contract of insurance should NOT
- Aa. Treat all the information supplied by the prospective policyholder in confidence for the sole purpose of issuing an insurance policy
- Bb. Give advice only on insurance matters in which he is knowledgeable and seek or recommend other specialist advice if necessary.
- Cc. Discourage the prospective policyholder from stating material facts to the insurance company or include the person not to state them
- Dd. Ensure as far as possible the policy proposed best meets the needs and resources of the prospective policyholder
16369. Group insurance cover for a member of a group terminates when this member
- Aa. Is given more responsibilities with this group
- Bb. Has a child
- Cc. Leaves the company
- Dd. Marries
16470. Under the Guidelines on Medical and Health Insurance Business, cost-sharing provisions shall be limited to the lower of _________ (excluding deductibles) or _______ (includes of deductibles) and shall not be mandatory.
- Aa. 20% or RM3,000
- Bb. 30% or RM3,000
- Cc. 30% of RM5,000
- Dd. 20% or RM5,000
16571. According to the guidelines on investment-linked business, the valuation of units shall be carried out every
- Aa. Business week
- Bb. Business day
- Cc. Day
- Dd. Week
16674. All contracts are governed by the general principle of the law of contract as specified in the
- Aa. Insurance Act 1996
- Bb. Contracts Act 1950
- Cc. Financial Services Act 2013
- Dd. Companies Act 1965
16775. Exclusions are inserted into policies for the following reasons, EXCEPT:
- Aa. The cover is not demanded by the insured.
- Bb. the insurer requires additional premium for such cover.
- Cc. cover can be provided under more appropriate policies.
- Dd. the risks are uninsurable.
16876. Carelessness, unreasonableness and fraud are some of the forms of _______ hazard.
- Aa. Social
- Bb. Moral
- Cc. Physical
- Dd. Biological
16977. With a large number of similar loss exposures, an insurance company is able to predict an expected loss; however,
- Aa. There is an element of uncertainly as the actual loss may not be the same as the expected loss.
- Bb. There is an element of surprise as the actual loss may be greater than the expected loss.
- Ca. There is an element of certainly as the actual loss may be the same as the expected loss.
- Dd. There is an element of uncertainly as the actual loss may be less than the expected loss.
17078. _____ buy insurance products.
- Aa. Lloyd’s underwriting members
- Bb. Insurance and reinsurance companies
- Cc. Individuals and business entities
- Dd. Insurance brokers and agents
17179. From the following, select that which is the main purpose of life and general insurance:
- Aa. Investment income
- Bb. Saving for retirement
- Cc. Financial protection
- Dd. Financial gain
17280. Schedule 9 of the Financial Services Act (FSA) 2013 sets out the
- Aa. Licensing of life and general insurers
- Bb. Conversation to single insurance business
- Cc. Pre-contractual duty of disclosure
- Dd. Financial Ombudsman Scheme
17381. In the absence of any specific questions in the proposal form, an not required to disclose a fact that _____.
- Aa. Affects insurer’s rating of the risk
- Bb. Influences the decision in acceptance of the risk
- Cc. Increase the risk to the insurer
- Dd. Diminishes the risk to the insurer
17482. The first stage in Risk Management is
- Aa. Analysis
- Bb. Transfer
- Cc. Identification
- Dd. Control
17583. Investment-linked life insurance policies (especially those risks which are fully invested in units of equity funds) are only suitable for policy owners who _____.
- Aa. are looking for regular income
- Bb. have a long-term objective
- Cc. can tolerate the risks of short-term fluctuations
- Dd. cannot tolerate the risks of short-term fluctuations
17684. In the discount market, the difference between the discounted price and the par value is represented as the _____.
- Aa. interest
- Bb. profit
- Cc. coupon
- Dd. yield
17785. Non-participating life policyholders have no right to share in the _____ of the insurer’s life insurance fund.
- Aa. investment returns
- Bb. operating expenses
- Cc. distributable profits
- Dd. divisible surplus
17886. When there is non-payment of life policy premiums, the appropriate modification depends on the cash surrender value available and the individual’s need for continued the insurance protection in accordance with his _____.
- Aa. financial capacity to pay future premiums
- Bb. financial standing in society
- Cc. future financial needs of the family
- Dd. financial ability to earn a future income
17988. Choose the statement that is correct regarding a regular premium Investment-linked policy.
- Aa. Regular premium investment-linked insurance is more inclined towards protection than investment.
- Bb. Regular premium investment-linked insurance id more inclined towards investment than protection.
- Cc. 80% of the premium received by the insurer for regular premium investment-linked insurance is used to purchase fund units in the first year.
- Dd. 100% of the premium received for regular premium investment-linked insurance is used to purchase fund units in the first year.
18089. Select the statement that is true of fixed deposits.
- Aa. The shorter the period, the higher the return.
- Bb. The longer the period, the higher the return.
- Cc. They are guaranteed by the government.
- Dd. They are only issued with the government’s approval.
18190. Identify what will happen to an investment-liked policy if a policyholder decides to surrender the policy before three years.
- Aa. The policyholder will lose a great deal as the premium allocation charges in this scheme is front loaded.
- Bb. The policyholder will not lose anything as all the premium allocated is invested into the investment.
- Cc. The policyholder will lose a very small insurance fee as the premium allocation charges in this scheme are very low.
- Dd. The policyholder will not lose anything as the premium is considered capital guaranteed if the policy is discontinued.
18291. The administration fee, insurance charge, fund management fee, etc. of an investment-linked life insurance policy are usually _____.
- Aa. Fixed
- Bb. Not guaranteed
- Cc. Guaranteed
- Dd. Decided by Bank Negara Malaysia
18392. Policy owners are relieved of the day-to-day administration of their investments, which can be a complicated affair. They just have to keep track of their investment through _____.
- Aa. the insurance agent.
- Bb. the relationship manager of the insurance company.
- Cc. the unit statements provided regularly by the insurance company
- Dd. the branch office of the insurance company.
18493. The minimum age requirement for minors to take up a life with the consent of the parent or guardian is
- Aa. Age of 18 to 21
- Bb. Age of 0 to 10
- Cc. Age of 16 to 18
- Dd. Age of 10 to 16
18594. What is the minimum age for a minor to take up life insurance on his own life or on the life of another in which he has insurable interest without consent of his parent or guardian?
- Aa. 19 years
- Bb. 21 years
- Cc. 18 years
- Dd. 16 years
18695. An annuity is _____ fund which can be purchased for the right to a series of periodic payments under a contract with a life insurer.
- Aa. a savings
- Bb. a retirement
- Cc. a trust
- Dd. an investment
18796. Identify when insurable interest needs to be present.
- Aa. At the inception of the policy
- Bb. At the maturity of the policy
- Cc. Before the death of the life assured
- Dd. During the death of the life assured.
18897. _____ is/are the investments that a life office has made from the premiums it has received after meeting its outgoes in the form of claims and expenses.
- Aa. Liability
- Bb. Surplus
- Cc. The market value
- Dd. Assets
18998. A person insuring the life of another must have insurable interest in that life at policy inception; otherwise, the policy issued would be deemed
- Aa. unenforceable
- Bb. illegitimate
- Cc. void
- Dd. voidable
19099. Select from the following what a life insurer would do if, after the policy has been in force for three years, it is found the life insured’s age is different from what was stated in the life policy.
- Aa. The life insurer will take no action.
- Bb. The life insurer will vary sum assured, premium and bonuses to reflect the actual age.
- Cc. The life insurer will terminate the policy.
- Dd. The life insurer will charge the life assured in court.
191100. If an 80-year-old is found to own very aggressive funds, or a single person in his twenties has invested purely in bonds, it shows that
- Aa. risk profiling exercise may not have been done.
- Bb. older people are more aggressive in their investment strategy.
- Cc. the 80-year-old is not risk averse.
- Dd. the single person is risk averse
192101. Select the statement that is correct.
- Aa. Withdrawals from EPF may not be made on a regular basis.
- Bb. Malaysians who contribute to the Employees Provident Fund (EPF) are allowed to utilize a portion of their EPF account to invest in funds offered by approved unit trust operating companies.
- Cc. If we want to compare single premium investment-linked (SP-IL) life insurance with unit trusts (UTs), we can find no differences at all between them.
- Dd. The array of funds available for selection in the unit trust industry may generally be smaller than that offered by an insurance company.
193102. _____ can be extended under a hospital and surgical insurance policy with the payment of additional premium.
- Aa. Life insurance
- Bb. Overseas cover
- Cc. Mental disorder
- Dd. Disability income
194103. For continuity of coverage of renewable policies, the insurer shall NOT
- Aa. unilaterally terminate the policy during the cover period.
- Bb. refuse to increase the amount of cover due to certain material fact.
- Cc. renew the policy upon the renewal date.
- Dd. reject the policy renewal.
195104. _____ is recommended for a person wo has started a new business venture and has invested heavily into the business.
- Aa. Whole life insurance
- Bb. Keyman insurance
- Cc. Endowment assurance
- Dd. Investment-linked life insurance
196105. Raymond would like to purchase a single premium investment-linked policy. He wants to ensure that his account value after purchase is exactly RM100,000 after the initial cost involved are deducted. His premium will be _____.
- Aa. RM90,250
- Bb. RM100,000
- Cc. RM95,000
- Dd. RM105,263
197106. For a regular premium investment-linked pan, the maturity benefit is payable from the
- Aa. sum assured only.
- Bb. account value only.
- Cc. sum assured and account value.
- Dd. sum assured or account value, whichever is higher.
198107. From the following statements, select the statement that is true of a unit trust investment.
- Aa. The trustee manages the portfolio of investments and administers the buying and selling of shares in the unit trust
- Bb. Unit trust investment, comprising an array of funds ranging from equity, bond, fixed income, balanced fund, etc., is established by a trust deed.
- Cc. The dead enables a fund manager to hold the pool of money and assets in trust on behalf of the investors.
- Dd. A unit trust is a two-way arrangement among investors represented by the agent and the unit trust operating company.
199109. The eligibility criteria to automatically add new employees to group life policy from the date of recruitment is:
- Aa. All employees selected by an internal recruitment process.
- Bb. Permanent employees between the ages of 16 and 60.
- Cc. Permanent and temporary workers with valid work permits.
- Dd. Healthy employees under a contract of service regardless of age.
200110. Santana chooses to convert his policy to a paid-up policy. As a result,
- Aa. No further premium is payable but the sum assured will be reduced.
- Bb. No further premium is payable but the sum assured will remain the same.
- Cc. No further premium is payable but the sum assured will increase.
- Dd. No further premium is payable but the sum assured will decrease gradually.
Information
- Description
- Quiz on PCIL sample question pt 1, created by Cham JiaJun on 13/03/2023.
- Author
- Cham JiaJun
- Language
- English
- Views
- 26
- Rating
- No ratings yet Rate this quiz