III, Licentiate Exam|IC 02, Practice of Life Insurance|One Liners|Chapter 4

III, Licentiate Exam|IC 02, Practice of Life Insurance|One Liners|Chapter 4

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 4  – ANNUITY 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 4: ANNUITY

1. For regular source of income – Annuity required.
2. No medical checkup for Annual policies.
3. Annuity payment can  be  decided  by  Annuitant,  as  MONTHLY,  SEMI  and ANNUALLY.
4. ANNUITIZING: Giving instructions to Insurer by Insured to Annuitize income.
5. Annuitant has option of making payment by Lumpsum or Instalments.
6. Single Premium payment of Annuity preferred by Retired people and Retiring people.
7. Multiple pre payment– Preferred by young  salaries  industrialists.
8. Annuities can be classified as

• Basics of premium payment.
• Basics of payment of annuity
• Basics of purpose of annuity
• Basics of type of Investment.

9. Premium can be made refund to the beneficiaries to the Annuitant, if Annuitant dies During the deferred period.
10. On the basis of payment of Annuity: LIFE ANNUITY :

• Annuitant– Till a person lives the Insurance company will pay amount of Annuity to is returned to his beneficiary.
• Annutant– If after death, rest of accumulated fund

11. Annuity certain for certain and life after:

• If we choose Annuity for 20 yrs, and die in 12th year, balance 8yr benefits goes to beneficiaries since the life choose as 20 yrs.

12. Joint Life Annuity /Last Survivor  Annuity:

• Annuity paid to Annuitant for their entire life.
• 50% of the pension will be paid to spouse as long as spouse lives.
• Like Family pension.

13. Annuity for Life with ROP.

• Till we are alive Annuity is paid.
• After death ROP to benefits.

14. Annuity is fixed every year by a fixed rate or amount.
15. On the basis of type of investment.

Fixed Annuity:

• Guaranteed  amount  of  Annuity.
• Investment is made in low risk securities like govt bonds.

 Variable Annuity:

• Payment  depends  on  performance  of  funds  chosen  by  annuitant.
• Investment on money marketing, stocks and bonds.

16. Free cover Limit = No evidence Limit.
17. Contributory Insurance Plan: Members can pay part of premium
18. Non Contributory Insurance Plan: Members do not contribute premium.
19. Individuals are not parties to Insurer.
20. Group Insurance can be taken by an individual for which not suits for higher premium to afford.
21. Funding of gratuity on cash accumulation basis.
22. The contribution of the company towards graduity is shown as Business Expenses.
23. Provision of pension is not a statuatory requirement.
24. Designing of product is done by Insurer.

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