PCE A & C ENGLISH SET B
1. An arrangement whereby individual losses are shared by members of a group facing similar risk exposure is called ________________.
2. Which of the following regarding insurance is wrong?
3. Which of the following is NOT covered by General Insurance?
4. The earliest beginning of insurance were in the field of _________.
5. The insurance industry in Malaysia had been largely patterned on the ________ system.
6. In order to standardize and control the insurance business in Malaysia, the first Insurance Act was introduced in ____________.
7. Which of the following is not a method of handling risk?
8. ____________ refers to an area of study which measures the chance of occurrence of a particular event.
9. Empirical Probability is determined on the basis of ____________.
10. The risk that affects the entire economy or large number of people / groups within the economy is called ______________.
11. The situation where there is the possibility of profit, loss or no loss is _____________.
12. Loss Control measures handle risks by :I. Loss Prevention 
II. Loss Minimisation
III. Loss Prediction 
IV. Loss Avoidance
13. The systematic approach to dealing with risks that threaten assets and earnings of a business or enterprise is called ________________.
14. The following arrangement of Risk Management is wrong, kindly rearrange them according to sequence.I. evaluating potential losses 
II. implementing the risk management program
III. selecting techniques of risk handling 
IV. identifying loss exposures
15. Which of the following is NOT the characteristics of insurable risk?
16. When a loss is one that is accidental and unintentional, it is ___________________.
17. There must be a large number of similar risk before any one of the risks is capable of being insured, the reasons are :I. To enable the insurer to predict losses more accurately. 
II. If there are only few risks, the principle of losses of a few to be borned by many  cannot be applied.
III. The insurance company can charge higher premium. 
IV. To enable the insurer to calculate a loading.
18. ________________________ is to advise the takaful company on its operations in order to ensure that it does not involve in any element which is not approved by the Syariah.
19. The principle of subrogation arises out of the principle of ____________________.
20. What is the proximate cause?
21. Which of the following is NOT the special legal principles embodied in insurance contract?
22. What is assignment?
23. Utmost Good Faith is breached when the proposer who knows or is reasonably expected to know the material fact is ______________________.I. Fails to disclose 
II. Been misrepresents
III. Been disclose fully and accurately 
IV. Been loss by the company
24. Which of the following is NOT a payment method of indemnity?
25. “Mudharabah” is defined as a contractual agreement between _______________.I. Investor 
II. Trustee
III. Entrepreneur 
IV. Capital Provider
26. The most accurate defination for “Tabaruk” is _________________.
27. In which part of The Takaful Act 1984 discuss about mode and conduct of Takaful business such as restriction, operations, establishment and maintenance of Takaful fund and allocation surplus.
28. Perils which have been expressly excluded from the policy called _____________.
29. The principle requires the insurers to restore the insured to the same financial position as he/she had enjoyed immediately before the loss called _______________________.
30. Perils which is not mentioned in the policy and therefore not covered by the policy unless they occur as a result of an insured perils are known as ___________________.
31. When an insurance company organizes its department on a functional basis, the basic function and decision making tend to be centralized at the head office. What is the disadvantage of centralization?
32. Which of the following are the main components of insurance market?I. Buyers 
II. Sellers
III. Bankers 
IV. Service Specialist
33. The department involved in setting the selection criteria, selects the risk and determine the premium, term and conditions of new business and renewal.
34. When action of insurance company is centralized, all the process are concentrated at the ____________________.
35. Which of the following is NOT the main objectives of the Malaysian Insurance Institute (MII)?
36. What do u understand about insurance company in centralized?
37. The surplus of a mutual insurance company are shared among __________ and the profits made by the operations of the proprietary company are distributed among its ____________.
38. This party normally acts on behalf of the insured and normally not tied to any one insurer.
39. A cooperative society transacting insurance business may be termed as a __________.
40. Life Insurance Association of Malaysia (LIAM) was established in _______________.
41. Which of the folllowing association paid compensation or allowance to victims of motor accidents where the ‘uninsured drivers’ are unable to meet their liability from their own personal resources.
42. Insurers will share the burden of paying claims particularly those involving large amount with _____________________.
43. LIAM is the _______________________________________________.
44. The Code of Ethics was established by ___________________________________.
45. Objective of self-regulation by the insurance industry are as follow, EXCEPT :
46. The objective of the Insurance Mediation Bureau is to provide dispute resolution procedures for policyholder and _____________________.
47. The Director General of Insurance (DGI) is empowered to supervise insurance companies and other things such as the following actions, EXCEPT :
48. In some instances, the insurer may not accept a proposal on its original terms but may offer to provide insurance on different terms. This transaction called :
49. Insurance contract is a legally binding agreement between :I. Government 
II. Insured
III. Insurer 
IV. Broker 
50. In general and life insurance contracts, the insured’s consideration is _____________.
51. The agreement are said to be “consensus ad idem”, that is:
52. A ____________ contract will remain valid until the aggrieved party exercises the option to treat it void.
53. An insurance contract is a legally binding agreement between an insured and his insurer. The essentials of an insurance contract requirements are :I. Intention to create legal relationship 
II. Offer and acceptance
III. Consent- consensus ad idem 
IV. Consideration 
54. The agent can act only within the authority granted to him by the principal. The granted authority may be ___________________.
55. Agent is given authority which is expressly stated in writing, it is called :
56. The relationship of principal and agent may be terminated by the following acts, EXCEPT :
57. The functions of selecting market segments which have similar needs for policies developed by the company is called _____________________.
58. A market-oriented agent will do the following, EXCEPT :
59. Please identify which of the following is NOT part of the customer buying decision process.
60. Based on the studies conducted by U.S.A. indicating that the most important factor for the selection of a particular insurer is ______________________.
61. When selling is done indirectly by establishing goodwill between the agent and his customer, it is called :
62. Which of the following is the evidence of premium payment for the policyholder?
63. A due payment shall be paid on the date specified in the policy contract. However, most contracts provide that such payments can be made within 30 days from the due date. It is called ________________________.
64. The agent is helping the customer to uncover his needs and recommend policies to meet those needs. This selling techniques is called ____________________.
65. Which of the following is NOT true for mode of payment?
66. When determine the premium rate, which of the following was not taken into account by the insurance company?
67. The term “Uberrima fides” is referring to :
68. A contract where one party provides something of value to another party in exchange for a promise that the other party will perform a stated act if a specified, uncertain event occurs is called an :
69. Which of the following situation do not have insurable interest?
70. Section _______ of the Insurance Act 1996 elaborates on the principle of insurable interest.
71. For life insurance contracts, the risk to be insured _____________ with time.
72. Which of the following parties need to observe the principle of Utmost Good Faith?I. The insured 
II. The agent
III. The insurer 
IV. The legislator
73. In general insurance, the insured risk may not increase with duration, and in fact may decrease due to ________________________________________.
74. Employer of ABC company purchased a group insurance for his employees. What will happen to the group insurance if one of his employee leaves the company?
75. Participants in Family Takaful Plans may elect to incorporate any of the following supplementary benefits :I. Permanent Total Disability 
II. Critical Illness Benefit
III. Personal Accident 
IV. Hospitalization Benefit
76. “This contract is mainly for protection purpose and the main benefit is generally guaranteed.” Which of the following contract describe the above statement?
77. Level Life Annuity Contract can be defined as a ___________________.
78. Which of the following policies would you recommend to a customer who needs to prepare an education fund for their children. (Choose the BEST answer)
79. What is the minimum age limit required to participate in Takaful Plan?
80. In Takaful, a person who joins any of the Family Takaful Plan become a __________.
81. Mr. Lim bought a life insurance of RM100 000 and RM50 000 accident benefit. If he died due to accident, how much can he claim from the insurance company?
82. Which of the following is true about the group insurance?I. It cannot issued to unions, trust and other entities 
II. Group insurance may extend to cover employee’s spouse and eligible children.
III. The employee does not need to go for medical check up. 
IV. Group insurance must be a monthly renewable contract.
83. Which of the following policy generally utilise to cover loans which is gradually being repaid?
84. Family Takaful benefits are divided into three (3) main portion as below EXCEPT :
85. Endowment insurance can be used as ________________________.
86. A convertible term is a term where ___________________________.
87. Which type of policy is the purest form of permanent contract, can be issued with or without participating and provides larger amount of life cover than any other permanent type of life insurance?
88. For Deferred Annuity, if death occurs before the annuity payment commences ______.
89. Which of the following statements are false?I. Renewable term can be renewed with evidence of continued good health.
II. At the time of renewal, increased premium will be charged based on the attained  age of the life assured.
III. An annuity certain is a life annuity where in the return for the payment of a certain  sum, known as the purchase money , the office makes a series of yearly, half  yearly or quarterly payments for a specified number of years.
IV. The joint life annuity promises to pay the sum assured in the event of the death  of the last survivor. 
90. The Contract of Group Insurance is solely between the insurance company and the employer who is named in ____________ as the _______________.
91. Premium paid by the client is divided into the following components,I. Expense related 
II. Investment related
III. Benefit charges 
IV. Mortality cost related
92. One of the Children’s Insurance is Protected Educational Policies. In this form of insurance, the policy is issued on the life of the ___________. The _________ is designated as the beneficiary.
93. In Group Insurance, if the employer pays all the cost or in other words, the plan is ___(I)____, __(II)___ of all the eligible employees must join. If the employer and employees share the cost, the plan is ____(III)______, at least __(IV)___ of all eligible employees must join.
94. Which are the true statements regarding Guaranteed Immediate Annuity?I. This contract provides guaranteed payments over a fixed period before the death of  the annuitant. 
II. This is a normal life annuity.
III. The annuity payment will cease on death of the annuitant. 
IV. The annuity payment will continue to be paid till the end of the guaranteed period.
95. _______ days of grace are allowed for the payment of yearly, half-yearly, quarterly and monthly premiums.
96. When a policy in force for ______ years or more, the ordinary policy becomes entitled to a surrender value.
97. Section ______ of the Insurance Act 1996 regulates the basis of surrender values.
98. Which of the following regarding policy loans is NOT true?I. The governing rate of interest on the loan shall be fixed by the company granting  the loan. 
II. The policy loans must be repaid within 3 years after the issuance of such loan.
III. The policyholder entitles to loan anytime in their life time. 
IV. The amount of loan available will be quoted on application to the government.
99. __________ policy is a policy under which, the cash value available is used as a single premium to provide for an insurance on the original terms, but for a reduced sum assured.
100. Which of the following is NOT under the non-forfeiture provision ?
101. Which of the following are the criteria of Automatic Premium Loan?I. It provides a continuation of the insurance cover when the assured fails to pay a  premium. 
II. The assured must provide evidence of insurability when bringing the policy back  to its original status.
III. Premiums shall be thus paid until the cash value has been entirely utilized.
IV. The use of Automatic Premium Loan allows continuity of supplementary benefits. 
102. Which of the following regarding Paid-up policy is NOT true?I. Once the policy is converted into Paid-up policy, no further premiums are payable.
II. All riders and supplementary benefits such as for disability and accidental death  shall remain in force.
III. Generally a participating policy will cease to participate in future benefits after  such conversion. 
IV. The length of the term insurance depends on the available amount of the cash  value applied as a gross single premium at the time of conversion.
103. Which of the following cannot be the only basis for an insurance contract to be void?
104. Which of the following is NOT considered when applying for reinstatement?
105. ____(I)_____ is the written document which embodies that agreement is in concrete form. ___(II)____ is an intangible thing, a legally binding agreement between the concerned parties.
106. An ________ is one which does not leave any right with the assignor except paying of premiums if he chooses to pay.
107. The insurer cannot deny liability on the policy after 2 years of its issue on the grounds of misrepresentation or non-disclosure alone unless he can prove that such misrepresentation or non-disclosure was made fraudulently by the insured. This statement is referring to :
108. The most common forms of policy alterations are :I. Change the mode of payment 
II. Decrease the sum assured
III. Change the class of policy 
IV. Removal of extra premium
109. Section 156 of the Insurance Act 1996 provides that where a life policy has been in force for three (3) years or more, it shall not lapse by reason of non-payment of premiums but shall have effect subject to such modification as to the period for which the policy is to be in force, or of the benefit receivable under it , or both. This statement is referring to :
110. In calculating risks, the insurer have to consider a few factors that may affect the policy condition which is _____________________.I. Avocation 
II. Education
III. Occupation 
IV. Ethnicity 
111. Which of the following is false ?
112. The insurer usually employs any one of the following methods to deal with sub standard lives EXCEPT :
113. Financial underwriting seeks to discover the following :I. Insurable Interest 
II. Physical Hazard
III. Financial Status 
IV. Moral Hazard 
114. When there is an extra loading on the proposal, a letter indicating the loading is issued to the proposer as a _____________.
115. When the proposal being approved without premium payment, company will issue a letter of acceptance to the proposer required to make a payment within _______ days.
116. Commencement of the policy may be back dated to an earlier date, usually up to a maximum of ____________.
117. Which of the following statements are true?I. Cooling off period is 14 days 
II. Medical Underwriting seeks to assess the extent of physical hazard in connection  with the applicant when providing insurance coverage.
III. Bonus adjustment is one of the treatment of sub-standard lives. 
IV. Rural area’s mortality rate is lower than the urban area.
118. For those in employment, taxable / assessable income constitutes such items as :-I. leave pay 
II. commissions
III. gratuity 
IV. allowance 
119. The premium is allowable when life insurance or deferred annuity is __________.I . on the individual’s life 
II. on the joint lives of the individual and his/her spouse
III. on the life of the spouse of the individual 
IV. on the life of the individual’s parents 
120. The ________________ serves as an official record of policies issued by the insurer.
121. For participating policies, they are charged a slightly higher premium than their non participating counterparts and this additional premium is known as _______________.
122. Two types of periodical premiums : -I. Installment Premium 
II. True Premium
III. Consistent Premium 
IV. Level Term Premium 
123. The charge for covering the cost of mortality alone is called the ________________.
124. Under this type of regular premiums, the premium payments cease on death and no deduction is made from the claim amount.
125. What is Gross Premium?
126. Liability = The present value of the benefits payable _______ The present value of expenses ______ The present value of the future premium receivable.
127. The assets may be valued in several ways, depending on the purpose of the valuation. Some of the common methods of valuing assets are :-Add description here!
128. _____________ is only paid on policies resulting into claims either by maturity or death, provided the policies concerned had been kept fully inforce by payment of premium until such date of claim.
129. Which among the following are NOT a form of bonus ?
130. What is Cost Price?
131. The main sources of surplus are :I. Expenses 
II. Mortality
III. New Business 
IV. Interest
132. What type of value which the assets can be sold in the open market?
133. What is the purpose of a Valuation Exercise ?I. To comply with the statutory requirement. 
II. To test the adequacy of the previous premium scale.
III. To test whether the company is solvent. 
IV. To determine if any changes in the company’s operation are necessary. 
134. Under this method, the bonus allotted is in proportion to the sum assured and the bonuses accumulated under the policy.
135. The portion of the surplus that may be passed to the shareholders in the form of individuals is normally stated in the company’s memorandum of Articles of Association or by registration and is in the region of ___________ of the divisible surplus.
136. What type of form need applicant to fill-up major portion of the information relating to applicant himself ?
137. “This section includes a declaration that answers given in the proposal and medical report forms shall form the basis of the contract”
138. The proposal form completed by the applicant contains as below, EXCEPT :
139. Generally, information necessary for the proper assessment of risk obtained from different sources as below, EXCEPT :
140. Besides recording the applicant’s answer concerning medical history, the reports of examining doctor include :I. Height and weight 
II. Pulse and blood-pressure readings
III. Chest and abdomen measurements 
IV. Condition of heart, lungs, nervous system
141. Two main forms of policy are in use the ___________ type and the _________ type.I. Narrative 
II. Schedule
III. Preamble 
IV. Condition
142. Which report furnishes the agent’s impression about the applicant’s habits, appearance, character and financial status?
143. Which form of policy is very simple, readily understood and elastic in adaptability?
144. This section contains the applicant’s declaration, to the best of his knowledge, true and complete and permission authorizing the insurer to seek information from any doctor who has ever attended to him and any life office. Which section is these?
145. The standard policy documents are often endorsed to take into account the differing aspects of individual circumstances and needs. Endorsements can be done at the :I. Time of issue of policy 
II. After issue of policy
III. Before issue of policy 
IV. During the issue of policy
146. The main sections found in the policy are, EXCEPT :I. The Operative Clause 
II. Condition
III. Endorsement 
IV. The Preamble 
147. Which of the following statement is NOT true ?
148. Under which circumstances, a claim may arise?
149. When a death claim is made, the insurer need to obtain the following documentary evidence from the claimant :I. Proof of Survival 
II. Proof of Death
III. Proof of Age 
IV. Proof of Title and Ownership 
150. The following documents are proof of title and ownership of an insurance policy, EXCEPT :
151. For maturity claim, the policyholder needs to complete 3 forms which are :I. Identity Form 
II. Discharge Form
III. Survival Form 
IV. Maturity Form
152. Which of the following is NOT relevant to the common settlement option for an endowment plan?
153. Doctrine of __________ is important to claims for personal accident policies, as more than one condition can operate leading to a claim.
154. En. Ahmad was born in May 2, 1970. He submitted his proposal on October 3, 1996, if the insurer used age last birthday as basis, what is En. Ahmad’s age in his proposal ?
155. What is En. Ahmad’s age if he submitted his proposal on Feb 3, 1998 and the insurer used age next birthday as basis ?
156. What is En. Ahmad’s age if he submitted his proposal on Dec 3, 1996 and the insurer used age nearest birthday as basis ?
157. Interest charge will occur when the policy holder _____________________.
158. Policies which accumulate _________ often carry the right to a policy loan.
159. Please refer to Table I & II for question 159 – 162.



Table I : Premium Rate for 25- year endowment insurance on male lives treat the female lives  as 3 years younger. 

Age (Next Birthday)

Premium per RM1000 sum assured

25

39.50

26

40.00

27

40.50

28

41.25

29

42.00

30

42.80

31

43.60


Table II : Discounts for large sum assured 

Sum Assured (RM)

Discount Per RM 1000 Sum Assure (RM)

10,000 – 24,999

1.00

25,000 – 39,999

2.00

40,000 – 54,999

3.00

55,000 – 69,999

4.00

Above 70,000

Special Quotation


Calculate the premium for the following applicant, 

Applicant : Darren 

Sex : Male 

Age : 26 

Sum Assured : RM 10,000 

160. Calculate the premium for the following applicant,

Applicant : Simon 

Sex : Male 

Age : 30 

Sum Assured : RM 45,000

161. Calculate the premium for the following applicant and determination of age is next birthday.

Applicant : Chris Tan 

Sex : Male 

Date of Birth : July 25, 1970 

Cover to commence : January 26, 1998 

Sum Assured : RM 50,000 

162. Calculate the premium for the following applicant, determination of age is next birthday.

Applicant : Angeline 

Sex : Female 

Date of Birth : December 25, 1970 

Cover to commence : January 26, 1998 

Sum Assured : RM 30,000 

163. Guidelines on Code of Conduct, which are abided by all employees of insurers operating in Malaysia at all times, are formulated by _______________
164. Who is the supervisory authority for insurance company?
165. The Audit/Disciplinary Committee of the insurer is responsible for _______________.
166. The term life insurance used in Code of Ethics and Conduct covers :I. Home Service 
II. Ordinary Life Insurance
III. Pensions Contract 
IV. Permanent Disability Insurance
167. The life insurance’s Code of Conduct applies to all the following persons, EXCEPT :I. Life insurer’s employee 
II. Insurance agents
III. Registered Insurance Brokers 
IV. Registered Insurance Consultants