III, Licentiate Exam|IC 02, Practice of Life Insurance|One Liners|Chapter 1

III, Licentiate Exam|IC 02, Practice of Life Insurance|One Liners|Chapter 1

The practice of Life Insurance (IC – 02) is a paper in III Licentiate Examination for Life Insurance. The practice of Life Insurance (IC 02) is a mandatory paper and it comprises of 20 marks. This is the most important paper in III Licentiate Examination, and most people prefer this paper.
This paper comprises of 100 Multiple Choice Questions. Aspirants need to score 60% in this paper to qualify for Licentiate.

We are providing Chapter I – Life Insurance Organisation one-liners of this paper practice of Life Insurance (IC – 02) which will be very important from exam point of view. This one-liners is very easy to understand.

Chapter I – Life Insurance Organisation

1. Issuance of insurance policy document.
2. Keeping watch on conditions of Insurance contract by either party. Eg.-Timely payment of premium
3. Attending requirements of nomination, assignments, surrenders, payment of claims.
4. Activities on compliance with laws and regulations, investment of funds, maintenance of Accounts, management of personnel etc.
5. Head office is responsible for

• Investment of Funds.
• Maintenance of Accounts.

6. A Company is a Group of Shareholders.
7. Total Capital divided  into  small  units  called  Shares  which  is  paid  by  the Share holders.
8. An Organisation is  a  Legal  entity.
9. Forms of Organisation:

• Companies
• Partnership  Firms
• Cooperative  Societies
• Propritorship  Firms
• Trusts.

10. Settling underwriting standards will be made by Insurer.
11. At Headoffice

• Actuarial  Department
• Investment  Department

12. Work of Headoffice

• Acturial
• Studying the claims experience
• Doing valuations
• Declaration  of  Bonus
• Monitoring the adequacy of premium
• Developing new products
• Studying Mortality table

13. PLI – Postal  Life  Insurance

• Premium collected by all PO
• Final  accounting  is  centralised  at  Director  of  Accounts,  Calcutta

14. Central Office handles  – Actuarial and Investment functions
15. An Ambassador is an agent of their country.
16. The person who  will  do  the  job  of  meeting,  explaining  persuading potential customers Called AGENTS.
17. Agents are appointed by  IRDA.
18. A licensed Agent can work for one Life Insurer.
19. Agents can be  Individual/Corporate  bodies.
20. Agents/Broker get Commission from Insurer.
21. Insurance Broker are Independent and not attached to any particular Insurer.
22. A BROKER can do business with more than one Insurance Company.
23. A Broker is  a  mediator  to  both  Individual  Customer  and  Insurance Company.
24. Brokers claim Commission only from Insurers.
25. Agents can be found through

• Press Advertisement.
• Employment  agencies.
• Members of Staff

26. An Agent should disclose licence whenever on demand.
27. Supervisory level between  Agent  and  B.O.  are  DEVELOPMENT  OFFICER.
28. Agents can be remunerated by

• Payment  of  fixed  monthly  salary.
• Commission.
• Part  payment  of  (1)  and  (2).

29. Commission of %age of premiums paid.
30. Bonus Commission will be payable on First year premium as an incentive for the performance.
31. An Agent can entitled to receive commission for rest of the lives or later.

• If worked as Agents at least 5 years with a business of Rs.50,000/- (or)
• If worked for 10 years

32. Agency for LIC Agency year is from date of appointment to end of completion of 12 months as agent and successive period. Eg: 1.1.2015  –  Date  of  Appointment  to  31.12.2015  is  Agency  year.

33. If part of  commission  paid  to  Policy  holders  by  Agent  is  IILEGAL  and not allowed under section Section  41  of  Insurance  Act  1938.

• This leads to cancellation of Agents Licence.
• Agents has to pay penalty.

34. While offering rebate – Agency will be terminated.
35. Banks are Corporate Agents.

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