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Life Insurance Products Flashcards

6 cards from real BCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 6 Life Insurance Products flashcards as text

  1. What is a 'whole life' insurance policy commonly sold in Singapore?

    Answer: A policy that provides coverage for the insured's entire lifetime with a savings component

    Whole life insurance provides lifelong coverage and typically includes a cash value component that accumulates over time, making it both a protection and savings instrument.

  2. What is the key difference between a 'participating' and 'non-participating' life insurance policy in Singapore?

    Answer: Participating policies share in the insurer's surplus/profits; non-participating do not

    Participating policies entitle the policyholder to receive bonuses from the insurer's participating fund surplus. Non-participating policies offer guaranteed benefits only.

  3. What is the purpose of DependentsProtection Scheme (DPS) in Singapore?

    Answer: To provide affordable term life insurance coverage for CPF members

    The DPS is a term life insurance scheme that provides basic coverage of $70,000 for CPF members aged 21-60, ensuring dependents receive a payout if the member passes away or becomes permanently incapacitated.

  4. What type of life insurance policy pays a benefit only if the insured dies within a specified period?

    Answer: Term life policy

    Term life insurance provides coverage for a specified period (e.g., 10, 20, or 30 years). If the insured survives the term, no benefit is paid and the policy expires.

  5. What is an endowment policy in the Singapore insurance market?

    Answer: A plan that combines insurance protection with a savings or investment component, maturing after a set period

    Endowment policies provide a lump sum on maturity or death, whichever occurs first. They are popular in Singapore for medium-term savings goals like education or retirement.

  6. Under MAS Notice 307, what must Singapore insurers disclose in the Benefit Illustration (BI) for life insurance products?

    Answer: Projected returns at two different investment rate scenarios (lower and higher)

    MAS Notice 307 requires insurers to provide Benefit Illustrations showing projected policy values at two scenarios: a lower (e.g., 3.25%) and higher (e.g., 4.75%) investment return rate.