IFoA SP2 Practice Questions - IFoA SP2 Life Insurance Specialist Principles Exam - IFoA SP2 Practice Questions - IFoA SP2 Life Insurance Specialist Principles Exam

Question 1

A without-profits whole life assurance pays a fixed sum assured on death whenever it occurs. Which feature most distinguishes it from a term assurance contract?

It always provides cover for the whole of life, so a claim is certain provided premiums are paid It contains a unit-linked investment account It cannot have a single-premium version It guarantees a maturity value at a fixed term

Correct Answer:

It always provides cover for the whole of life, so a claim is certain provided premiums are paid

Question 2

An insurer wants a savings product whose investment return is explicitly linked to the value of an underlying fund of assets, with the policyholder bearing most of the investment risk. Which contract design is most appropriate?

Conventional without-profits endowment Unit-linked contract Term assurance Immediate annuity

Correct Answer:

Unit-linked contract

Question 3

Which of the following is the primary purpose of a with-profits (participating) life insurance contract from the policyholder's perspective?

To receive a guaranteed fixed return identical to a government bond To obtain pure protection at the lowest possible premium To share in the surplus of the with-profits fund through bonuses while obtaining smoothed investment returns and guarantees To gain direct unit-by-unit exposure to equity markets

Correct Answer:

To share in the surplus of the with-profits fund through bonuses while obtaining smoothed investment returns and guarantees

Question 4

An immediate annuity is most exposed to which of the following risks for the insurer?

Lapse risk from early surrender Expense overrun on new business acquisition only Mortality risk that policyholders die earlier than expected Longevity risk that annuitants live longer than assumed

Correct Answer:

Longevity risk that annuitants live longer than assumed

Question 5

Which statement best describes a critical illness (dread disease) policy?

It pays a lump sum on diagnosis of one of a defined list of serious medical conditions It pays only on death within a fixed term It refunds all premiums at maturity regardless of health It pays a regular income only while the policyholder remains unable to work

Correct Answer:

It pays a lump sum on diagnosis of one of a defined list of serious medical conditions

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About this Exam

Prepare with the IFoA SP2 Practice Questions - IFoA SP2 Life Insurance Specialist Principles Exam practice quiz. This question bank includes 100 questions covering insurer, value, risk, business, and life. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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IFoA SP2 Practice Questions - IFoA SP2 Life Insurance Specialist Principles Exam

This practice set contains 100 questions from the matching question bank and focuses on insurer, value, risk, business, and life. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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IFoA SP2 Practice Questions - IFoA SP2 Life Insurance Specialist Principles Exam

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