Life Insurance M5 Flashcards

What is the free-look period for life insurance policies in Singapore?

Answer: 14 days

Singapore mandates a 14-day free-look period during which the policyholder can cancel a new life insurance policy and receive a full refund of premiums paid.

What is a non-participating policy?

Answer: A policy with guaranteed benefits that does not share in the insurer's profits

A non-participating policy provides guaranteed benefits only and does not share in the insurer's surplus or profits. Benefits are fixed and predictable.

What is the MAS Notice on Product Advertising for insurance?

Answer: Rules governing how insurance products can be advertised to the public

MAS Notices on product advertising set out rules and standards that insurance companies must follow when advertising their products to ensure fair and accurate representation.

What is the surrender value of a policy?

Answer: The amount a policyholder receives when terminating the policy before maturity

The surrender value is the cash amount a policyholder receives from the insurer when they voluntarily terminate (surrender) their policy before its maturity date.

What is underwriting in life insurance?

Answer: The process of assessing risk and deciding whether to accept an applicant

Underwriting is the process where the insurer evaluates the risk of insuring an applicant based on their health, age, occupation, and lifestyle to determine premiums and acceptance.

What is a convertible term policy?

Answer: A term policy that can be converted to a permanent policy without a medical exam

A convertible term policy gives the policyholder the option to convert it to a permanent (whole life or endowment) policy without needing to prove insurability.