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1. What is the difference between life insurance and accidental death and
dismemberment insurance?
a) Life insurance pays a benefit only if the insured dies of natural causes,
while accidental death and dismemberment insurance pays a benefit only if
the insured dies or loses a limb or an organ due to an accident.
b) Life insurance pays a benefit regardless of the cause of death, while
accidental death and dismemberment insurance pays a benefit only if the
insured dies or loses a limb or an organ due to an accident.
c) Life insurance pays a benefit regardless of the cause of death, while
accidental death and dismemberment insurance pays a benefit only if the
insured loses a limb or an organ due to an accident.
d) Life insurance pays a benefit only if the insured dies within a specified
period, while accidental death and dismemberment insurance pays a benefit
regardless of the time of death or injury.
Answer: B
Rationale: Life insurance is a contract that guarantees a payment to the
beneficiary upon the death of the insured, regardless of the cause of death.
Accidental death and dismemberment insurance is a type of life insurance
that pays an additional benefit if the insured dies or suffers a loss of limb or
organ due to an accident.
2. What is the purpose of underwriting in life and health insurance?
a) To determine the eligibility and premium rate of the applicant based on
their risk profile.
b) To verify the identity and medical history of the applicant based on their
documents and records.
c) To provide financial advice and guidance to the applicant based on their
needs and goals.
d) To monitor and manage the claims and benefits of the policyholder based
on their contract terms.
Answer: A
Rationale: Underwriting is the process of evaluating the risk factors of an
applicant for life and health insurance, such as age, gender, health status,
occupation, lifestyle, family history, etc. Based on this assessment, the
insurer decides whether to accept or reject the application, and what
premium rate to charge.
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