AK_IC - MOCK EXAM SET B
1. Life insurance contributes directly to the welfare and progress of the country by
a. accumulating capital for investment in commerce and industry
b. partially relieving the community of the care of dependents
c. encouraging provisions for the future
d. all of the above
2. One supplementary benefit offered is a payor’s benefit which is intended to
a. provide for the return of premiums to an adult payor in the event that a minor insured dies
b. provide a waiver of premium benefit in the event of death or disability of the person
paying the premium
c. allow the insurance company to pay the policy’s proceeds to the person who seems
equitably entitled to the proceeds
d. assure that the adult payor will retain a vested interest in the policy when the insured
reaches the age of majority
3. A whole life policy with an initial premium rate that applies to the first 5 years of the policy and a
higher premium rate that applies to the remainder of the premium-payment period is known as
a. an extended life policy c. an experience-premium policy
b. a modified life policy d. a guaranteed renewable policy
4. A risk is considered substandard based on any or all of the following criteria
a. death, occupation and moral character
b. occupation, moral character and family health history
c. income, educational attainment and occupation
d. death, income and educational background
5. The only instance when a life insurance contract is treated primarily as an indemnity agreement is
when a
a. person insures the life of a friend
b. creditor insures the life of his debtor to protect himself
c. person insures the life of his or her spouse to protect against the loss of income earned by
the spouse
d. person in a partnership insures the life of his partner to protect the firm against loss due to
the death of that partner
6. Which of the following describes the convertible feature of a term insurance policy?
a. It may be changed to another term insurance policy without evidence of insurability
b. It may be changed for a guaranteed sum
c. It may be changed to another whole life policy
d. It may be changed to a permanent insurance without evidence of insurability
Agency Training and Development Department Page 1 ANSWER KEY_IC_MOCK B_V2
, 7. A policy which permits the policyholder to vary the level of premium or the sum insured, and has its
cash values dependent upon investment performance and the level of premiums paid is known as a
(an) __________ policy.
a. participating whole life
b. term with advance premium deposit provision
c. annuity
d. universal life
8. A policy which affords coverage for two or more persons simultaneously with the face amount of the
policy payable when any of the insured dies at which time the policy terminates automatically is
known as a
a. Joint and Survivor Annuity c. Joint Life Policy
b. Double Duty Pesos Insurance d. Split Pesos Insurance Policy
9. The savings element of permanent plans allows for the build up of
a. dividends c. maturity benefits
b. cash values d. death benefits
10. Mr. Alvarez bought a P150,000 policy with a 20-year reducing term rider. He died 5 years after the
policy issue date. After his death, his wife received P150,000 and a monthly income thereafter for
15 years. This definitely has a
a. Family Maintenance Insurance
b. Family Income Rider
c. Straight Family Policy
d. Combination of whole life and level term insurance
11. Disability benefits are not paid
a. for self-inflicted injuries
b. if there is a loan against the policy
c. if all the policy dividends have been withdrawn
d. if disability resulted from sickness only
12. A person wanting a greater coverage for the least amount of premium has an option of attaching
what rider in his permanent life policy?
a. a waiver of premium c. guaranteed insurability rider
b. term insurance rider d. accidental death rider
13. A hazardous occupation could be defined as
a. an occupation the duties of which expose the insured to a degree of danger of sustaining
injury
b. an occupation in an unhealthy working condition exposing the insured to elements which
can cause sickness
c. an occupation which exposes the insured to social hazards
d. all of the above
Agency Training and Development Department Page 2 ANSWER KEY_IC_MOCK B_V2
1. Life insurance contributes directly to the welfare and progress of the country by
a. accumulating capital for investment in commerce and industry
b. partially relieving the community of the care of dependents
c. encouraging provisions for the future
d. all of the above
2. One supplementary benefit offered is a payor’s benefit which is intended to
a. provide for the return of premiums to an adult payor in the event that a minor insured dies
b. provide a waiver of premium benefit in the event of death or disability of the person
paying the premium
c. allow the insurance company to pay the policy’s proceeds to the person who seems
equitably entitled to the proceeds
d. assure that the adult payor will retain a vested interest in the policy when the insured
reaches the age of majority
3. A whole life policy with an initial premium rate that applies to the first 5 years of the policy and a
higher premium rate that applies to the remainder of the premium-payment period is known as
a. an extended life policy c. an experience-premium policy
b. a modified life policy d. a guaranteed renewable policy
4. A risk is considered substandard based on any or all of the following criteria
a. death, occupation and moral character
b. occupation, moral character and family health history
c. income, educational attainment and occupation
d. death, income and educational background
5. The only instance when a life insurance contract is treated primarily as an indemnity agreement is
when a
a. person insures the life of a friend
b. creditor insures the life of his debtor to protect himself
c. person insures the life of his or her spouse to protect against the loss of income earned by
the spouse
d. person in a partnership insures the life of his partner to protect the firm against loss due to
the death of that partner
6. Which of the following describes the convertible feature of a term insurance policy?
a. It may be changed to another term insurance policy without evidence of insurability
b. It may be changed for a guaranteed sum
c. It may be changed to another whole life policy
d. It may be changed to a permanent insurance without evidence of insurability
Agency Training and Development Department Page 1 ANSWER KEY_IC_MOCK B_V2
, 7. A policy which permits the policyholder to vary the level of premium or the sum insured, and has its
cash values dependent upon investment performance and the level of premiums paid is known as a
(an) __________ policy.
a. participating whole life
b. term with advance premium deposit provision
c. annuity
d. universal life
8. A policy which affords coverage for two or more persons simultaneously with the face amount of the
policy payable when any of the insured dies at which time the policy terminates automatically is
known as a
a. Joint and Survivor Annuity c. Joint Life Policy
b. Double Duty Pesos Insurance d. Split Pesos Insurance Policy
9. The savings element of permanent plans allows for the build up of
a. dividends c. maturity benefits
b. cash values d. death benefits
10. Mr. Alvarez bought a P150,000 policy with a 20-year reducing term rider. He died 5 years after the
policy issue date. After his death, his wife received P150,000 and a monthly income thereafter for
15 years. This definitely has a
a. Family Maintenance Insurance
b. Family Income Rider
c. Straight Family Policy
d. Combination of whole life and level term insurance
11. Disability benefits are not paid
a. for self-inflicted injuries
b. if there is a loan against the policy
c. if all the policy dividends have been withdrawn
d. if disability resulted from sickness only
12. A person wanting a greater coverage for the least amount of premium has an option of attaching
what rider in his permanent life policy?
a. a waiver of premium c. guaranteed insurability rider
b. term insurance rider d. accidental death rider
13. A hazardous occupation could be defined as
a. an occupation the duties of which expose the insured to a degree of danger of sustaining
injury
b. an occupation in an unhealthy working condition exposing the insured to elements which
can cause sickness
c. an occupation which exposes the insured to social hazards
d. all of the above
Agency Training and Development Department Page 2 ANSWER KEY_IC_MOCK B_V2
