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Question 1 of 30
1. Question
Which of the following statements are TRUE about annuity certain?
I. It provides for annuity benefit payments to be made for a fixed number of years only, whether death occurs in the meantime or not.
II. It may have high upfront costs and other fees as with traditional annuities.
III. It refers to a financial product that features a predetermined periodic payout amount until the death of the annuity owner—called the annuitant.
IV. It is an investment in retirement income offered by insurance companies.Correct
Annuity certain provides for annuity benefit payments to be made for a fixed number of years only, whether death occurs in the meantime or not. It may have high upfront costs and other fees as with traditional annuities. It is an investment in retirement income offered by insurance companies.
Incorrect
Annuity certain provides for annuity benefit payments to be made for a fixed number of years only, whether death occurs in the meantime or not. It may have high upfront costs and other fees as with traditional annuities. It is an investment in retirement income offered by insurance companies.
-
Question 2 of 30
2. Question
In the limitations of Disability Waiver of Premium, which of the following statements best explains premium frequency?
Correct
Premium frequency
Differing practices exist as to what mode of premium payment is assumed when premiums are being waived. For example, if premiums are being waived on a monthly basis, the insured person who recovers, say, 25 days after a premium has been waived would have to resume premium payments the following month.Incorrect
Premium frequency
Differing practices exist as to what mode of premium payment is assumed when premiums are being waived. For example, if premiums are being waived on a monthly basis, the insured person who recovers, say, 25 days after a premium has been waived would have to resume premium payments the following month. -
Question 3 of 30
3. Question
Which of the following refers to a financial product that features a predetermined periodic payout amount until the death of the annuity owner?
Correct
Life annuity
The term life annuity refers to a financial product that features a predetermined periodic payout amount until the death of the annuity owner—called the annuitant. An annuitant typically pays into the annuity periodically when they are still working.Incorrect
Life annuity
The term life annuity refers to a financial product that features a predetermined periodic payout amount until the death of the annuity owner—called the annuitant. An annuitant typically pays into the annuity periodically when they are still working. -
Question 4 of 30
4. Question
The cover given by this rider is similar to personal accident or medical insurance, so it normally carries some similar exclusions. Which of the following are included in this?
I. Unintentional self-inflicted injuries
II. Injuries sustained whilst engaging in criminal activities
III. Pre-existing conditions
IV. Injuries resulting from war while the policyowner-insured is in military serviceCorrect
The cover given by this rider is similar to personal accident or medical insurance, so it normally carries some similar exclusions. Which of the following are included in this?
• Intentional self-inflicted injuries
• Injuries sustained whilst engaging in criminal activities
• Pre-existing condition
• Injuries resulting from war while the policyowner-insured is in military serviceIncorrect
The cover given by this rider is similar to personal accident or medical insurance, so it normally carries some similar exclusions. Which of the following are included in this?
• Intentional self-inflicted injuries
• Injuries sustained whilst engaging in criminal activities
• Pre-existing condition
• Injuries resulting from war while the policyowner-insured is in military service -
Question 5 of 30
5. Question
Two alternative methods are used to establish the amount of disability income to be paid – an income formula and a flat benefit amount. Which of the following statements best describes flat benefit?
Correct
Two alternative methods are used to establish the amount of disability income to be paid – an income formula and a flat benefit amount. A flat benefit amount is a method for calculating a pension payout from an employee’s defined benefit plan.
Incorrect
Two alternative methods are used to establish the amount of disability income to be paid – an income formula and a flat benefit amount. A flat benefit amount is a method for calculating a pension payout from an employee’s defined benefit plan.
-
Question 6 of 30
6. Question
Which of the following statements are is TRUE about Accidental Death and Dismemberment (AD&D) Rider?
I. It usually takes the form of a rider to a life insurance policy.
II. It pays benefits in the case of a person’s accidental death or dismemberment, which is the loss—or loss of use—of body parts or functions.
III. It comes with significant coverage limitations, so always read the fine print.
IV. It is a provision in a life insurance or accident policy whereby the company agrees to pay the stated multiple the face amount in the contract in cases of death caused by accidental means.Correct
Accidental Death and Dismemberment (AD&D) Rider usually takes the form of a rider to a life insurance policy. It pays benefits in the case of a person’s accidental death or dismemberment, which is the loss—or loss of use—of body parts or functions. It comes with significant coverage limitations, so always read the fine print.
Incorrect
Accidental Death and Dismemberment (AD&D) Rider usually takes the form of a rider to a life insurance policy. It pays benefits in the case of a person’s accidental death or dismemberment, which is the loss—or loss of use—of body parts or functions. It comes with significant coverage limitations, so always read the fine print.
-
Question 7 of 30
7. Question
Which of the following statements are included in the customary provisions of the accidental death benefit (ADB)?
I. Injuries resulting from war while the policyowner-insured is in military service
II. Death must have been caused directly and independently of all other causes, by an accidental bodily injury, and have occurred within one year after that injury
III. Customary personal accident insurance exclusions apply
IV. Accident benefits that are commonly added to any kind of life insurance policy relate to accidental death and dismemberment.Correct
The customary provisions of the accidental death benefit (ADB) are:
• Death must have been caused directly and independently of all other causes, by an accidental bodily injury, and have occurred within one year after that injury
• Customary personal accident insurance exclusions applyIncorrect
The customary provisions of the accidental death benefit (ADB) are:
• Death must have been caused directly and independently of all other causes, by an accidental bodily injury, and have occurred within one year after that injury
• Customary personal accident insurance exclusions apply -
Question 8 of 30
8. Question
Which of the following provides the total security of knowing that the retirement income is guaranteed at a certain percentage of the accumulated fund?
Correct
Guaranteed annuity provides the total security of knowing that the retirement income is guaranteed at a certain percentage of your accumulated fund. Annuities with a guaranteed retirement income can do a lot to boost your pension income.
Incorrect
Guaranteed annuity provides the total security of knowing that the retirement income is guaranteed at a certain percentage of your accumulated fund. Annuities with a guaranteed retirement income can do a lot to boost your pension income.
-
Question 9 of 30
9. Question
Accidental bodily injuries being covered, a schedule (or list) of specified injuries is given, with a corresponding benefit against each. Which of the following are included in this?
I. Death
II. Disease or illness
III. Loss of Two Limbs
IV. Total Loss of SightCorrect
Accidental bodily injuries being covered, a schedule (or list) of specified injuries is given, with a corresponding benefit against each. It includes:
• Death
• Disease or illness
• Loss of Two Limbs
• 1 Limb & Sight in 1 Eye
• Either 1 Limb or Sight in 1 Eye
• Various specified lesser injuriesIncorrect
Accidental bodily injuries being covered, a schedule (or list) of specified injuries is given, with a corresponding benefit against each. It includes:
• Death
• Disease or illness
• Loss of Two Limbs
• 1 Limb & Sight in 1 Eye
• Either 1 Limb or Sight in 1 Eye
• Various specified lesser injuries -
Question 10 of 30
10. Question
The normally applicable exclusions, which are commonly found with personal accident cover which of the following?
I. Disease or illness caused by an accident
II. Self-inflicted injuries (including suicide, at any time)
III. War-related injuries
IV. Injuries whilst involved in illegal activitiesCorrect
The normally applicable exclusions, which are commonly found with personal accident covers the following:
• Self-inflicted injuries (including suicide, at any time)
• War-related injuries
• Injuries whilst involved in illegal activities
• Disease or illness (unless caused by an accident)
• Childbirth & pregnancy
• Injuries resulting from hazardous sports (as defined)Incorrect
The normally applicable exclusions, which are commonly found with personal accident covers the following:
• Self-inflicted injuries (including suicide, at any time)
• War-related injuries
• Injuries whilst involved in illegal activities
• Disease or illness (unless caused by an accident)
• Childbirth & pregnancy
• Injuries resulting from hazardous sports (as defined) -
Question 11 of 30
11. Question
Which of the following statements is TRUE about accelerated death benefits?
Correct
Accelerated death benefits
The meaning of this is that when a policyowner-insured in a prescribed serious situation, all or part of the death benefit under the policy may be payable to him, although death has not yet occurred.Incorrect
Accelerated death benefits
The meaning of this is that when a policyowner-insured in a prescribed serious situation, all or part of the death benefit under the policy may be payable to him, although death has not yet occurred. -
Question 12 of 30
12. Question
Provisions for accelerated death benefits are contained in an accelerated death benefit rider (ADB rider), also known as a living benefit rider. Common features with the different riders concerned. Which of the following are included in this?
I. The benefits are released at times of great personal stress, under grave and life-threatening circumstances.
II. The riders are only likely to be permitted with policies having a significant face amount for the sake of keeping administrative costs down.
III. It normally undertakes to pay a benefit equal to the face amount of the basic policy as an additional sum should death be caused by an accident.
IV. If the policy has been assigned, the assignee must sign such a release form, before an ADB is paid.Correct
Provisions for accelerated death benefits are contained in an accelerated death benefit rider (ADB rider), also known as a living benefit rider. Common features with the different riders concerned. It includes:
• The benefits are released at times of great personal stress, under grave and life-threatening circumstances.
• The riders are only likely to be permitted with policies having a significant face amount for the sake of keeping administrative costs down.
• Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider.
Provisions for accelerated death benefits are contained in an accelerated death benefit rider (ADB rider), also known as a living benefit rider. Common features with the different riders concerned. It includes:
• The benefits are released at times of great personal stress, under grave and life-threatening circumstances.
• The riders are only likely to be permitted with policies having a significant face amount for the sake of keeping administrative costs down.
• Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider.
• If the policy has been assigned, the assignee must sign such a release form, before an ADB is paid.
• It has two accelerated death benefits, namely the critical illness and the long-term care benefits.Incorrect
Provisions for accelerated death benefits are contained in an accelerated death benefit rider (ADB rider), also known as a living benefit rider. Common features with the different riders concerned. It includes:
• The benefits are released at times of great personal stress, under grave and life-threatening circumstances.
• The riders are only likely to be permitted with policies having a significant face amount for the sake of keeping administrative costs down.
• Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider.
Provisions for accelerated death benefits are contained in an accelerated death benefit rider (ADB rider), also known as a living benefit rider. Common features with the different riders concerned. It includes:
• The benefits are released at times of great personal stress, under grave and life-threatening circumstances.
• The riders are only likely to be permitted with policies having a significant face amount for the sake of keeping administrative costs down.
• Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider.
• If the policy has been assigned, the assignee must sign such a release form, before an ADB is paid.
• It has two accelerated death benefits, namely the critical illness and the long-term care benefits. -
Question 13 of 30
13. Question
Which of the following statements is NOT true about long-term care (LTC) benefits?
Correct
This is not a very common product in Hong Kong at present, but the basic features of this rider are a stated portion of the death benefit is payable to a policyowner-insured who requires constant care for a condition.
Incorrect
This is not a very common product in Hong Kong at present, but the basic features of this rider are a stated portion of the death benefit is payable to a policyowner-insured who requires constant care for a condition.
-
Question 14 of 30
14. Question
In accelerated death benefits, the list of insured diseases is not identical with all insurers, but they all can be categorized. Which of the following are included in this?
I. Cancer
II. Disability
III. Illnesses related to the heart
IV. Self-inflicted injuriesCorrect
In accelerated death benefits, the list of insured diseases is not identical with all insurers, but they all can be categorized into the following:
• Cancer
• Illnesses related to the heart
• Disability
• Illnesses related to a major organ
• Illnesses related to the nervous system
• Illnesses related to the immune systemIncorrect
In accelerated death benefits, the list of insured diseases is not identical with all insurers, but they all can be categorized into the following:
• Cancer
• Illnesses related to the heart
• Disability
• Illnesses related to a major organ
• Illnesses related to the nervous system
• Illnesses related to the immune system -
Question 15 of 30
15. Question
Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider, require the latter to sign a form acknowledging that the death benefit stands reduced by the amount of the ADB payment. Which of the following form is this?
Correct
Release form
Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider, require the latter to sign a release (or release form), acknowledging that the death benefit stands reduced by the amount of the ADB payment.Incorrect
Release form
Since pre-death payments to the policyowner-insured will have an impact upon the expectations of the beneficiaries, some insurers will, in the event of a claim under the rider, require the latter to sign a release (or release form), acknowledging that the death benefit stands reduced by the amount of the ADB payment. -
Question 16 of 30
16. Question
In critical illness benefit, under which of the following circumstances a stated portion of the death benefit is paid to the policyowner-insured?
I. He/she suffered from self-inflicted injuries.
II. He/she is diagnosed with a specified disease.
III. He/she is diagnosed with a terminal illness and has a life expectancy of 12 months or less.
IV. It is necessary for him/her to undergo a specified medical procedure.Correct
In critical illness benefit, a stated portion of the death benefit is paid to the policyowner-insured when:
• He/she is diagnosed with a specified disease
• He/she is diagnosed with a terminal illness and has a life expectancy of 12 months or less
• It is necessary for him to undergo a specified medical procedure.Incorrect
In critical illness benefit, a stated portion of the death benefit is paid to the policyowner-insured when:
• He/she is diagnosed with a specified disease
• He/she is diagnosed with a terminal illness and has a life expectancy of 12 months or less
• It is necessary for him to undergo a specified medical procedure. -
Question 17 of 30
17. Question
In critical illness benefit, which of the following statements is TRUE about the medical evidence?
Correct
One of features of critical illness is its medical evidence such as a statement from an attending physician is necessary, confirming the condition and, in the case of a terminal illness, the assessed life expectancy as well.
Incorrect
One of features of critical illness is its medical evidence such as a statement from an attending physician is necessary, confirming the condition and, in the case of a terminal illness, the assessed life expectancy as well.
-
Question 18 of 30
18. Question
Literally “dismemberment” means losing one or more members (limbs), but the term within the AD&D rider relates to both the loss of limbs and the loss of sight. Which of the following are included in the usual provisions of this?
I. Normally, a sum equal to the accidental death benefit is payable if the life insured loses any two limbs or the sight in both eyes as a result of an accident.
II. Often policies provide for a payment equal to a stated proportion of the accidental death benefit if an accident results in the loss of one limb, the loss of sight in one eye, or another specified lesser injury.
III. The loss of a limb may be described as the actual loss of limb (by physical severance at or above the wrist or ankle) or the loss of the use of the limb.
IV. Usually waivers are only available to cover disabilities that begin during a specified age range, such as the age range of 15 – 65.Correct
The usual provision of dismemberment includes:
• Normally, a sum equal to the accidental death benefit is payable if the life insured loses any two limbs or the sight in both eyes as a result of an accident.
• Often policies provide for payment equal to a stated proportion of the accidental death benefit if an accident results in the loss of one limb, the loss of sight in one eye, or another specified lesser injury.
• The loss of a limb may be described as the actual loss of limb (by physical severance at or above the wrist or ankle) or the loss of the use of the limb.Incorrect
The usual provision of dismemberment includes:
• Normally, a sum equal to the accidental death benefit is payable if the life insured loses any two limbs or the sight in both eyes as a result of an accident.
• Often policies provide for payment equal to a stated proportion of the accidental death benefit if an accident results in the loss of one limb, the loss of sight in one eye, or another specified lesser injury.
• The loss of a limb may be described as the actual loss of limb (by physical severance at or above the wrist or ankle) or the loss of the use of the limb. -
Question 19 of 30
19. Question
The basic policy remains in full force during total disability. What is the reason behind this?
Correct
The basic policy remains in full force during total disability so that if death occurs during a period of total disability the face amount of the basic policy is payable in addition to any income benefits paid or payable.
Incorrect
The basic policy remains in full force during total disability so that if death occurs during a period of total disability the face amount of the basic policy is payable in addition to any income benefits paid or payable.
-
Question 20 of 30
20. Question
Which of the following are included in the one or more benefits of accidental benefits it may cover?
I. Serious Burns
II. Self-inflicted injuries
III. Weekly Benefits
IV. Double IndemnityCorrect
In accidental benefits, other benefits cover may include one or more of the following:
• Serious Burns
• Weekly Benefits
• Hospital Benefit
• Double IndemnityIncorrect
In accidental benefits, other benefits cover may include one or more of the following:
• Serious Burns
• Weekly Benefits
• Hospital Benefit
• Double Indemnity -
Question 21 of 30
21. Question
Under a life policy, what is the reason why the “Double Indemnity” provision is incorrectly named?
Correct
Double Indemnity Benefit
The term ‘Indemnity’ is technically inaccurate since life insurance is normally not subject to the principle of indemnity.Incorrect
Double Indemnity Benefit
The term ‘Indemnity’ is technically inaccurate since life insurance is normally not subject to the principle of indemnity. -
Question 22 of 30
22. Question
The amount of benefit will vary between companies and depend on the type of disease contracted, payment of the full death benefit being a possibility. In connected in this, critical illness benefit is invariably paid as which of the following?
Correct
Lump sum payment
The amount of benefit will vary between companies and depend on the type of disease contracted, payment of the full death benefit being a possibility. Critical illness benefit is invariably paid as a lump sum.Incorrect
Lump sum payment
The amount of benefit will vary between companies and depend on the type of disease contracted, payment of the full death benefit being a possibility. Critical illness benefit is invariably paid as a lump sum. -
Question 23 of 30
23. Question
Which of the following statements are included in the restrictions in the critical illness benefit?
I. Critical illness cover is only available up to a specified age, say, age 60
II. Critical illness cover is only available to standard risks
III. Payments may not be made for multiple/recurring events, perhaps subject to exceptions with a couple of diseases
IV. In waiting period, the diagnosis mentioned in (a) above has to be one dwhen the rider has been in effect for a specified number of days, say, 90 days.Correct
Restrictions in the critical illness benefit include:
• Critical illness cover is only available up to a specified age, say, age 80
• Critical illness cover is only available to standard risks
• Payments may not be made for multiple/recurring events, perhaps subject to exceptions with a couple of diseases
• In the waiting period, the diagnosis mentioned in (a) above has to be done when the rider has been in effect for a specified number of days, say, 90 days.Incorrect
Restrictions in the critical illness benefit include:
• Critical illness cover is only available up to a specified age, say, age 80
• Critical illness cover is only available to standard risks
• Payments may not be made for multiple/recurring events, perhaps subject to exceptions with a couple of diseases
• In the waiting period, the diagnosis mentioned in (a) above has to be done when the rider has been in effect for a specified number of days, say, 90 days. -
Question 24 of 30
24. Question
Which of the following is the basic plan of medical benefits?
Correct
In earlier days, medical benefits would not be provided under life insurance policies. Such cover was considered to be part of the “Accident” (Personal Accident) portfolio. The basic plan of medical benefits is intended to cover the expenses related to medical treatment and hospitalization.
Incorrect
In earlier days, medical benefits would not be provided under life insurance policies. Such cover was considered to be part of the “Accident” (Personal Accident) portfolio. The basic plan of medical benefits is intended to cover the expenses related to medical treatment and hospitalization.
-
Question 25 of 30
25. Question
Which of the following policy comprising a death cover and a critical illness cover is now widely available in Hong Kong, with both sharing the same face amount?
Correct
A critical illness package policy comprising a death cover and a critical illness cover is now widely available in Hong Kong, with both sharing the same face amount. Yet critical illness benefit plans offering no death benefit and critical illness benefit riders with death benefit are also available.
Incorrect
A critical illness package policy comprising a death cover and a critical illness cover is now widely available in Hong Kong, with both sharing the same face amount. Yet critical illness benefit plans offering no death benefit and critical illness benefit riders with death benefit are also available.
-
Question 26 of 30
26. Question
Intended to cover the expenses related to medical treatment and hospitalization, the Basic Plan has a number of headings under which cover is given. Which of the following are included in this?
I. Hospital charges
II. Private nursing
III. In-patient physician’s fees
IV. Maintenance medicineCorrect
Intended to cover the expenses related to medical treatment and hospitalization, the Basic Plan has a number of headings under which cover is given. It includes:
• Hospital charges
• Private nursing
• In-patient physician’s fees
• Surgeon’s, anesthetist’s and operating theatre fees
• In-patient physician’s fees
• In-patient specialist’s fees
• Out-patient follow-up care
• Free worldwide assistanceIncorrect
Intended to cover the expenses related to medical treatment and hospitalization, the Basic Plan has a number of headings under which cover is given. It includes:
• Hospital charges
• Private nursing
• In-patient physician’s fees
• Surgeon’s, anesthetist’s and operating theatre fees
• In-patient physician’s fees
• In-patient specialist’s fees
• Out-patient follow-up care
• Free worldwide assistance -
Question 27 of 30
27. Question
Which of the following’s maximum benefit/cover is specified according to the three categories and the seriousness of the operation involved?
Correct
Surgeon’s, anesthetist’s and operating theatre fees
Surgeons, anesthetist’s and operating theatre fee’s maximum benefit/cover is specified according to the three categories and the seriousness of the operation involved.Incorrect
Surgeon’s, anesthetist’s and operating theatre fees
Surgeons, anesthetist’s and operating theatre fee’s maximum benefit/cover is specified according to the three categories and the seriousness of the operation involved. -
Question 28 of 30
28. Question
There are limits to the time during which various benefits under the basic and other plans may be paid, but these are part of the description of the cover. Which of the following are included in these exclusions?
I. Pre-existing conditions
II. Drug or other substance abuse
III. Sudden death
IV. Pregnancy and childbirth-related expensesCorrect
There are limits to the time during which various benefits under the Basic and Other Plans may be paid, but these are part of the description of the cover. Specific exclusions are very likely to include the following:
• Pre-existing conditions
• Pregnancy and childbirth-related expenses
• Drug or other substance abuse, self-inflicted injury, and sexually transmitted diseases
• AIDS or HIV related conditions
• Congenital abnormalities treatmentIncorrect
There are limits to the time during which various benefits under the Basic and Other Plans may be paid, but these are part of the description of the cover. Specific exclusions are very likely to include the following:
• Pre-existing conditions
• Pregnancy and childbirth-related expenses
• Drug or other substance abuse, self-inflicted injury, and sexually transmitted diseases
• AIDS or HIV related conditions
• Congenital abnormalities treatment -
Question 29 of 30
29. Question
Which of the following statements best describes insurability?
Correct
Insurability means that by normal underwriting and business standards a particular risk is acceptable for insurance. The usual feature that affects this is, of course, the health of the person who is to be the life insured.
Incorrect
Insurability means that by normal underwriting and business standards a particular risk is acceptable for insurance. The usual feature that affects this is, of course, the health of the person who is to be the life insured.
-
Question 30 of 30
30. Question
Which of the following statements best describes private nursing?
Correct
Private nursing
The basic plan is intended to cover the expenses related to medical treatment and hospitalization such as private nursing. Private nursing includes nursing treatment at home, in hospital by a qualified nurse, or as recommended by the attending medical practitioner.Incorrect
Private nursing
The basic plan is intended to cover the expenses related to medical treatment and hospitalization such as private nursing. Private nursing includes nursing treatment at home, in hospital by a qualified nurse, or as recommended by the attending medical practitioner.