CMFAS HI – Health Insurance Module Exam

Correct: Analyzing the client’s situation first is the right approach because needs selling prioritizes discovering the prospect’s actual requirements and providing a service-based advisory process rather than pushing a specific product. This ensures the recommendation is suitable for the client’s unique circumstances.

Incorrect: Immediately highlighting features based on an assumed need is wrong because it characterizes product selling, where the representative assumes the need and focuses on closing the sale quickly. Focusing on pricing and product benefits to make the client like the product is wrong because it makes the relationship dependent on the product’s appeal rather than the client’s actual needs. Using persuasive techniques to create pressure is wrong because needs selling aims to uncover existing concerns that the client already has, rather than creating artificial pressure to buy.

Takeaway: Needs selling focuses on a service-oriented approach where the representative uncovers the client’s unique situation to offer suitable solutions, fostering a long-term relationship.

Correct: Highlighting that the client may face less advantageous terms or higher premiums is the right answer because insurance representatives are required to explain the specific disadvantages of replacing a policy. This includes the risk that a client may not be insurable at standard terms due to a deterioration in health or that the new policy may have less beneficial conditions compared to the existing one.

Incorrect: The suggestion to terminate the old policy first is wrong because it creates a gap in coverage, leaving the client unprotected while the new application is being processed. The statement about the new insurer providing full coverage after a waiting period is wrong because insurers perform their own risk assessments and may exclude pre-existing chronic conditions entirely. Focusing only on administrative fees is wrong because it neglects the representative’s duty to discuss how the client’s health changes affect the viability and cost of the replacement.

Takeaway: When a client considers replacing a health insurance policy, the representative must clearly explain the risks of higher premiums and the potential loss of coverage for pre-existing conditions.

Correct: Statement I is correct because the requirement to preserve Medisave for future healthcare needs is no longer applicable once a member passes away, allowing the final hospital bill to be settled in full. Statement III is correct because the withdrawal limit for day surgery is structured to include a specific sub-limit for the doctor’s daily attendance fees. Statement IV is correct because allied health services, such as physiotherapy, are covered under the chronic disease management framework provided they are referred by the attending physician.

Incorrect: Statement II is incorrect because the daily withdrawal limit for psychiatric inpatient treatment is significantly lower than the standard inpatient limit, reflecting specific policy caps for mental health services compared to general medical wards.

Takeaway: Medisave withdrawal limits vary depending on the type of medical service provided, but these limits are waived for the final inpatient bill of a member who passes away during hospitalization. Therefore, statements I, III and IV are correct.

Correct: Statement I is correct because Medisave funds are specifically designated for the medical expenses of the account holder and their immediate family, which includes grandparents who are Singapore Citizens or Permanent Residents. Statement II is correct because the Basic Healthcare Sum acts as a regulatory cap on the Medisave Account; any contributions exceeding this limit are automatically redirected to the Special or Retirement Account. Statement IV is correct because Medisave is classified as an eligible payment source for premiums of national insurance schemes and approved private integrated shield plans.

Incorrect: Statement III is incorrect because the Medisave Minimum Sum requirement was officially removed in 2016. Members who reach the age of 55 are no longer obligated to top up their Medisave Account to a specific minimum level before they are permitted to withdraw funds from their Ordinary or Special Accounts.

Takeaway: Medisave is a regulated savings scheme with defined usage boundaries for family members and insurance premiums, governed by a maximum cap (BHS) rather than a mandatory minimum balance at age 55. Therefore, statements I, II and IV are correct.

Correct: Statement I is correct because self-employed individuals do not typically benefit from employer-sponsored medical leave or continued salary during illness, making a shorter deferred period necessary to provide timely financial support. Statement III is correct because language proficiency and education levels are key indicators of client vulnerability, which triggers a mandatory supervisor call-back to verify the client’s understanding of the product.

Incorrect: Statement II is incorrect because providing details about dependants or parents is generally optional and not a mandatory requirement unless the client is specifically applying for family-based coverage. Statement IV is incorrect because being a freelancer or self-employed person does not disqualify an individual from Disability Income Insurance; the exclusion only applies to those who are currently unemployed or those in unstable occupations like odd-job labor.

Takeaway: Employment status dictates the appropriate waiting period for disability benefits, while specific vulnerability markers like language proficiency require additional supervisory oversight to ensure fair treatment of clients. Therefore, statements I and III are correct.

Correct: An immediate family member aged 21 or older can sign the authorization form to use the deceased’s Medisave. In this specific circumstance, the Medisave balance can be used in full to cover the final inpatient bill without being restricted by the standard daily withdrawal limits that usually apply to hospital stays.

Incorrect: The suggestion that the hospital automatically settles the bill is incorrect because a formal authorization form must still be signed by an eligible person. The claim that withdrawal limits still apply is wrong because the regulations allow the full balance to be utilized for the final medical bill. The statement that only a legal representative can sign is incorrect because the rules specifically allow immediate family members, such as a spouse, parent, or adult child, to provide the necessary authorization.

Takeaway: For a deceased patient’s final hospital bill, immediate family members can authorize the use of the Medisave balance in full, exempting the claim from standard withdrawal limits.

Correct: The principle that total reimbursement from all policies is limited to the actual hospital expenses incurred is correct because the Co-ordination of Benefit Clause prevents an insured person from profiting from a medical claim. The secondary insurer will only pay the balance of the bill that remains after the primary or group policy has made its payout, up to the secondary policy’s limits.

Incorrect: The suggestion that a client can claim full benefits from both policies to exceed the actual bill is wrong because medical expense insurance is an indemnity-based product designed to cover actual losses, not provide a profit. The claim that private insurance must always pay first is incorrect as group policies often act as the primary layer of coverage. The idea that insurers must split the bill equally is incorrect because reimbursements are determined by the sequence of claims and the specific benefit limits of each policy, not an automatic equal division.

Takeaway: The Co-ordination of Benefit Clause ensures that the total payout from multiple medical expense policies does not exceed the actual expenses incurred by the policyholder.

Correct: Statement II is correct because the Flexi-Medisave scheme allows individuals aged 65 and above to utilize a specific annual amount for outpatient care at designated public and private clinics. Statement IV is correct because a mandatory cash co-payment is required for chronic disease management claims to encourage prudent use of medical services and prevent unnecessary usage.

Incorrect: Statement I is incorrect because Medisave is specifically restricted from being used for home medical equipment like blood pressure monitors or glucometers. Statement III is incorrect because for assisted conception treatments, only the Medisave accounts of the patient and her legal spouse may be utilized; other family members’ accounts are not permitted for this specific purpose.

Takeaway: Medisave usage is subject to specific age-related schemes and strict limitations regarding the types of equipment covered and which family members’ accounts can be accessed for specialized treatments. Therefore, statements II and IV are correct.

Correct: Evaluating the maturity date is the right answer because Critical Illness riders attached to endowment policies terminate once the policy matures. This often happens at an age when the client’s health risks are highest, potentially leaving them without necessary protection when they need it most.

Incorrect: Recommending immediate cancellation is wrong because it may leave the client temporarily uninsured or subject them to higher premiums and new underwriting. The claim that a rider automatically converts to a whole life policy is incorrect, as riders typically end when the base plan matures. Suggesting a 100% acceleration focus is wrong because while acceleration affects the payout structure, it does not address the fundamental risk of the coverage terminating upon the endowment’s maturity.

Takeaway: When reviewing Critical Illness riders attached to endowment plans, advisors must ensure coverage does not expire prematurely at maturity, leaving the client vulnerable in old age.

Correct: Statement I is correct because Method 1 specifically uses 75% of the monthly salary as the benchmark for disability income needs before deducting existing benefits. Statement III is correct because when calculating the lump sum total and permanent disability (TPD) requirement, only existing policies that provide TPD benefits, such as Group Term Life and the Dependants’ Protection Scheme, should be deducted from the total fund needed. Statement IV is correct because the lump sum method is a valid alternative for clients who do not qualify for monthly disability income insurance or do not have a stable income.

Incorrect: Statement II is incorrect because the expense-based method (Method 2) must include both the client’s personal expenses and their family’s expenses. This ensures that the family’s standard of living is maintained and that the client’s additional medical costs are covered during a period of disability.

Takeaway: When quantifying disability needs, advisors must choose the method that best fits the client’s eligibility and ensure all existing TPD-related coverages are accurately offset against the total requirement. Therefore, statements I, III and IV are correct.

Correct: Statement I is correct because MediShield Life was designed to provide universal coverage for life, effectively removing the previous age cap of 92 and the lifetime claim limit of $300,000. Statement III is correct because the scheme uses a front-loading premium structure where higher premiums paid during working years are used to provide rebates in later years, making premiums more manageable during retirement. Statement IV is correct because Additional Premium Support is specifically designed as a final safety net for individuals who remain unable to afford their premiums even after all other applicable subsidies and Medisave usage.

Incorrect: Statement II is incorrect because the additional premium loading for individuals with serious pre-existing conditions is not permanent; it is only payable for a fixed period of 10 years. This 30% loading is intended to help with the cost of coverage, while the government continues to bear the majority of the actual risk cost.

Takeaway: MediShield Life ensures lifelong protection by removing claim limits and using a sustainable premium-rebate system, supported by targeted subsidies for those with financial needs or pre-existing conditions. Therefore, statements I, III and IV are correct.

Correct: Explaining that the Additional Benefit Type pays out a sum on top of the main policy but usually ends at age 65, whereas the Acceleration Benefit Type reduces the main policy’s death benefit but typically lasts for the whole of life is correct. This accurately reflects that Additional benefits are separate payouts with an age limit, while Acceleration benefits are integrated into a life policy, providing longer coverage but reducing the final death benefit.

Incorrect: The suggestion that Additional Benefit is always more cost-effective is wrong because it ignores the age-65 limitation and the fact that premiums vary based on risk. The claim that only Acceleration benefits provide lump sums for rehabilitation is incorrect as both Critical Illness types are designed to provide lump sum payments for non-medical expenses. The statement that Additional Benefit provides lifelong coverage is factually wrong because this type of benefit typically terminates when the insured reaches age 65.

Takeaway: When choosing between Critical Illness benefit types, it is vital to distinguish between Additional benefits, which offer extra payouts but end at age 65, and Acceleration benefits, which provide lifelong coverage by drawing from a life policy’s death benefit.

Correct: Statement I is correct because Pioneer Generation members are entitled to premium subsidies ranging from 40% to 60% regardless of their household monthly income or the annual value of their home. Statement II is correct because Pioneers receive lifelong annual Medisave top-ups between S$200 and S$800, which are specifically intended to help offset their insurance premiums.

Incorrect: Statement III is incorrect because transitional subsidies, which help ease the shift for those facing premium increases, are only available for the first four years of the scheme, not five. Statement IV is incorrect because the scheme specifically waives the deductible requirement for outpatient treatments, meaning the insured does not have to pay a fixed upfront amount for those specific services.

Takeaway: Pioneer Generation benefits provide a guaranteed level of support through fixed subsidy rates and lifelong Medisave top-ups that are independent of a person’s financial or property status. Therefore, statements I and II are correct.

Correct: The statement regarding miscarriage benefits is the right answer because medical expense insurance policies specifically exclude coverage for the willful termination of a pregnancy that is requested by the insured person for personal reasons rather than medical necessity.

Incorrect: The statement about daily hospital cash is a true description of the common practice in Singapore where insurers use cash incentives to encourage ward downgrading and control medical costs. The statement about final expenses is true because Integrated Shield Plans typically provide this benefit by waiving the policyholder’s share of costs, such as the deductible and co-insurance components. The statement about medical evacuation is true because these services are strictly governed by medical necessity and professional medical assessment rather than the personal preference of the insured.

Takeaway: Additional medical benefits such as miscarriage coverage and medical evacuation are strictly contingent upon medical necessity and exclude elective or non-essential procedures.

Correct: The statement that the Insurance Act applies to the MediShield Life Scheme is incorrect because the legislation governing MediShield Life specifically stipulates that the general Insurance Act does not apply to the scheme or any actions taken under its governing Act.

Incorrect: The statement regarding the non-assignability of benefits is true, as the rights and benefits under the scheme are personal to the insured and cannot be transferred to others. The statement about Integrated Shield Plan (IP) premiums is true, as these private insurance components are subject to significant age-related increases and do not have guaranteed premium rates. The statement about the MediShield Life Fund is true, as it is managed as a not-for-profit, self-sustaining fund that uses actuarial principles to ensure it can meet current and future claims through periodic premium adjustments.

Takeaway: MediShield Life is governed by its own specific statutory framework which excludes the application of general insurance laws and prohibits the transfer or assignment of policy benefits.

Correct: Proposing a Major Medical Expense Insurance plan that complements the existing employer-sponsored coverage is the right answer because representatives should ensure new recommendations provide cover only for the client’s shortfall. Since the employer plan covers initial costs but has low limits, a Major Medical plan effectively addresses the risk of large bills without creating unnecessary over-insurance for smaller claims.

Incorrect: The suggestion to replace the employer plan is wrong because it ignores the benefit of existing coverage and may lead to higher costs for the client. Recommending a Hospital Cash policy is wrong because it provides a fixed daily income rather than reimbursing actual medical expenses, which does not directly solve the problem of low reimbursement limits. Advising the client to wait until leaving their job is wrong because it leaves the client exposed to financial risk from high medical bills in the interim, failing to meet their immediate need for adequate protection.

Takeaway: When recommending health insurance to a client with existing group coverage, the representative must ensure the new policy complements the existing plan to address shortfalls while avoiding over-insurance.

Correct: Explaining that the bill is pro-rated to 35% before the $2,000 deductible is applied is correct because MediShield Life is designed to provide coverage based on subsidized ward rates. For a Singapore Citizen staying in a Class A ward, the total bill is first multiplied by the pro-ration factor to determine the claimable amount, and then the $2,000 deductible (applicable to those under age 80 in Class A) is subtracted. Recommending an Integrated Shield Plan is the standard advice for individuals who prefer staying in higher ward classes or private hospitals.

Incorrect: The suggestion that the deductible is applied to the total bill before pro-rating is wrong because the pro-ration factor must be applied first to determine the claimable amount before any other deductions. The claim that the deductible is $5,000 is incorrect as the actual deductible for a Class A ward for an insured person under 80 is $2,000. Stating that maternity and dental are the only exclusions is inaccurate because the regulations list many other exclusions, such as ambulance fees, cosmetic surgery, and overseas medical treatment.

Takeaway: MediShield Life claims for higher-class wards are subject to pro-ration and specific deductibles, meaning patients will face significant out-of-pocket costs unless they have an Integrated Shield Plan.

Correct: The statement regarding Additional Premium Support is incorrect because individuals who choose to purchase an Integrated Shield Plan (IP) are specifically excluded from receiving this particular form of financial assistance. While IP holders may qualify for other subsidies such as those for lower-to-middle income households or the Pioneer Generation, the Additional Premium Support is reserved for those who remain on the basic MediShield Life scheme and cannot afford their premiums.

Incorrect: The statement about the insurer’s administrative role is true because the integrated structure is designed so the private insurer handles all claims and coordinates directly with the CPF Board, removing the need for the insured to contact multiple parties. The statement regarding pre-existing conditions is true because MediShield Life provides universal coverage for all conditions, and this protection remains active within the IP framework even if the private insurer applies exclusions to the additional coverage. The statement about Medisave limits is true because while the MediShield Life component is fully covered by Medisave, the private insurance portion is capped by specific withdrawal limits, often requiring a cash top-up.

Takeaway: While Integrated Shield Plan holders can access most MediShield Life subsidies, they are ineligible for Additional Premium Support and must pay for the private portion of their premiums in cash if it exceeds Medisave withdrawal limits.

Correct: The statement regarding the 60-day window for returning to a previous insurer is the right answer because it is factually incorrect. Under current regulations, a policyholder who switches their Integrated Shield Plan (IP) to a new insurer only has a 30-day window from the date of the termination notification to return to their previous insurer without being subject to new medical underwriting.

Incorrect: The statement about downgrading within the same insurer is wrong because it is a true statement; insurers allow policyholders to move to lower-tier plans at any time without requiring a new health assessment. The statement about automatic termination is wrong because it is also true; the system is designed to terminate the old IP automatically once the new one begins to prevent overlapping coverage. The statement about downgrading to MediShield Life is wrong because it is true; insurers cannot impose new exclusions when a member chooses to revert to the basic national health insurance scheme.

Takeaway: While policyholders can downgrade within the same insurer without medical reviews, switching to a new insurer requires new underwriting and only offers a 30-day window to return to the original insurer without penalty.

Correct: Statement I is correct because the data identifies accidents, poisoning, and violence as the leading cause of hospitalisation by discharge percentage across all years shown. Statement III is correct because the median (50th percentile) cost for heart attack treatment in Ward A is significantly higher than the bypass surgery cost in Ward B2, illustrating how ward choice impacts costs.

Incorrect: Statement II is incorrect because the 90th percentile is only an estimate of the upper range of bill sizes, and the data explicitly notes that actual bills can exceed this figure. Statement IV is incorrect because the 50th percentile represents the median cost where half of patients pay that amount or less; it is not a calculation based on the duration of stay.

Takeaway: Financial planning must account for the fact that typical bill sizes vary significantly by ward class and that actual medical costs can frequently exceed the 90th percentile estimates. Therefore, statements I and III are correct.

Correct: Statement II is correct because a systematic presentation of recommendations must include a detailed explanation of the benefit illustration, specifically distinguishing between guaranteed and non-guaranteed components. Statement III is correct because external developments, such as changes to Central Provident Fund (CPF) rulings, are recognized triggers that necessitate a formal review of the client’s existing insurance portfolio to ensure continued suitability.

Incorrect: Statement I is incorrect because while a representative may seek to clarify why a recommendation was rejected, they are explicitly advised not to insist if the client is unwilling to provide an explanation. Statement IV is incorrect because representatives should avoid recommending additional health insurance policies if the client already has adequate medical cover, as the client may be unable to claim benefits from multiple policies for the same loss.

Takeaway: Professional health insurance advisory requires transparent disclosure of benefit types and proactive portfolio reviews when regulatory or personal circumstances change, while strictly avoiding the practice of over-insuring clients. Therefore, statements II and III are correct.

Correct: Statement I is correct because Disability Income Insurance is specifically designed to replace lost earned income, which means individuals without a salary, such as housewives, are generally ineligible. Statement II is correct because the Total and Permanent Disability (TPD) benefit within a life insurance policy provides a lump sum or staggered payment that does not depend on the insured having a formal salary. Statement III is correct because insurers typically limit the monthly benefit to a percentage of the insured’s actual income (often around 75%) to ensure there is still a financial incentive for the individual to return to work.

Incorrect: Statement IV is incorrect because Personal Accident Insurance is explicitly identified as a valid alternative for providing disability protection to individuals who do not qualify for Disability Income Insurance, such as non-working spouses.

Takeaway: Disability Income Insurance is restricted to those with earned income, while non-earners must utilize Total and Permanent Disability benefits or Personal Accident policies to secure disability protection. Therefore, statements I, II and III are correct.

Correct: Advising a client to terminate an existing policy before the new one is officially accepted is the right answer because it is an incorrect and dangerous practice in the health insurance advisory process. A representative must ensure the client maintains continuous coverage. If the old policy is cancelled before the new insurer has completed underwriting and formally accepted the risk, the client risks being left without any insurance protection if the new application is declined or issued with significant exclusions.

Incorrect: Performing a thorough fact-finding exercise is a standard and mandatory requirement to ensure that any recommendation made is suitable for the client’s specific financial circumstances. Analyzing the client’s healthcare requirements to identify coverage gaps is a core component of the needs-based process, as it helps determine what additional protection is necessary. Providing a detailed explanation of pre-existing conditions and waiting periods is essential for transparency, ensuring the client understands how a new policy might limit coverage for health issues they already have.

Takeaway: During the needs-based advisory process, a financial representative must prioritize the continuity of the client’s protection and avoid creating any gaps in coverage when transitioning between policies.

Correct: Statement I is correct because the regulatory framework allows policyholders to purchase supplementary coverage from any of the three government-appointed insurers, even if it differs from their basic policy provider. Statement IV is correct because the eligibility for payouts under the scheme is specifically triggered when an insured individual is unable to perform at least three out of the six defined activities of daily living.

Incorrect: Statement II is incorrect because the standard 90-day waiting period for benefit eligibility is waived in instances where the severe disability is caused solely by an accident. Statement III is incorrect because although the coverage lasts for the lifetime of the insured, the premium payment period is limited and ceases once the individual reaches the age of 65.

Takeaway: ElderShield provides lifetime disability protection with premiums payable only until age 65, and it allows for flexible supplement options that can be sourced from different approved providers regardless of the basic plan’s insurer. Therefore, statements I and IV are correct.

Correct: The insurer may provide a Letter of Guarantee to waive the upfront deposit, and the final payout will be the higher of the amounts calculated under his IP and MediShield Life is the right answer because the Letter of Guarantee (LOG) is a service provided by IP insurers to waive or reduce upfront cash deposits at the hospital. Furthermore, for Integrated Shield Plans, the insurer and the CPF Board calculate benefits independently, and the policyholder is entitled to the higher of the two calculated amounts.

Incorrect: The claim that an insurer will provide a Letter of Guarantee for any condition is wrong because an LOG may be denied if the hospitalization is for a pre-excluded condition. The statement that the payout is the sum of both benefits is wrong because the payout is the higher of the two, not an addition of both. The requirement to pay a full deposit regardless of an LOG is wrong because the primary purpose of the LOG is to waive that deposit. The idea that the patient must manually submit bills is wrong because hospitals submit claims electronically on behalf of the patient through the MediClaim system.

Takeaway: Integrated Shield Plan payouts are based on the higher of the IP or MediShield Life benefit calculations, and the Letter of Guarantee is a facility used to waive upfront hospital deposits for eligible conditions.

Correct: Statement I is correct because the 90-day deferment period for ElderShield begins from the date the claim form is certified by an appointed assessor. Statement II is correct because the insurer is responsible for the costs of the initial and subsequent assessments if the claim is found to be payable.

Incorrect: Statement III is incorrect because premiums are waived while the insured is receiving monthly benefit payouts; they only resume if the insured recovers. Statement IV is incorrect because ElderShield includes a non-forfeiture feature where the policy can be converted into a paid-up policy with reduced benefits if the insured stops paying premiums after the policy has been in force for a sufficient number of years.

Takeaway: ElderShield provides financial relief through premium waivers during disability and protects long-term value through a non-forfeiture feature that allows for reduced paid-up benefits if premium payments cease. Therefore, statements I and II are correct.

Correct: An annual cash payment of $1,200 to help manage the costs associated with his functional disabilities is the right answer because the Pioneer Generation Disability Assistance Scheme (PG-DAS) provides this specific benefit to Pioneers who permanently require assistance with at least three Activities of Daily Living (ADLs). Mr. Tan qualifies as a Pioneer because he was born before 1950 and became a citizen before 1987, and his inability to perform washing, dressing, and feeding meets the three-ADL requirement.

Incorrect: The option regarding full reimbursement at private clinics is wrong because the Pioneer Generation outpatient subsidies apply specifically to polyclinics and public Specialist Outpatient Clinics, not private facilities. The option regarding a permanent premium exemption is wrong because while Pioneers receive significant subsidies for MediShield Life, they are not automatically exempt from all premiums for both MediShield Life and ElderShield. The option regarding a one-time grant from the Interim Disability Assistance Programme is wrong because that is a separate scheme for those who did not qualify for ElderShield, whereas the Pioneer Generation Package provides ongoing annual cash support through its own specific disability scheme.

Takeaway: The Pioneer Generation Disability Assistance Scheme provides life-long cash support to eligible seniors who meet specific age and citizenship criteria and require permanent assistance with at least three Activities of Daily Living.

Correct: Statement I is correct because the Coordination of Benefits clause is a standard insurance provision designed to prevent an insured person from profiting from a claim; it limits the total reimbursement from all applicable policies to the actual expenses incurred. Statement II is correct because a basic sufficiency analysis often uses current hospital cost data as a fixed benchmark, meaning it does not automatically factor in the rising cost of healthcare services over time due to inflation.

Incorrect: Statement III is incorrect because having sufficient coverage for hospital bills does not eliminate the need for other types of protection, such as Critical Illness or Long-Term Care insurance, which address different financial risks like loss of income or nursing costs. Statement IV is incorrect because sufficiency calculations typically do not assume that group insurance is portable; since group cover often ceases when a person leaves their employer, it is treated as a current benefit rather than a guaranteed long-term solution.

Takeaway: A comprehensive health insurance review must account for the Coordination of Benefits principle and recognize that meeting immediate hospitalisation needs does not negate the requirement for inflation adjustments or specialized covers like Critical Illness. Therefore, statements I and II are correct.

Correct: Statement I is correct because the Personal Accident policy was specifically recommended to bridge the gap in Total and Permanent Disability (TPD) coverage that remained after the Critical Illness policy was accounted for. Statement II is correct because eligibility for Disability Income Insurance typically requires the life insured to be gainfully employed or earning an income, which does not apply to a non-working spouse.

Incorrect: Statement III is incorrect because an “Acceleration Benefit” means the critical illness payout is drawn from the death benefit of the main policy, rather than being an additional standalone amount. Statement IV is incorrect because the Personal Accident policy is meant to provide low-cost supplementary cover for specific accidental events and medical expenses, not to serve as a replacement for comprehensive medical expense insurance like Group Hospital and Surgical plans.

Takeaway: When advising non-working clients, representatives must select products that provide lump-sum disability or accident benefits since income-replacement products are generally unavailable to those without earned income. Therefore, statements I and II are correct.

Correct: Statement I is correct because the insurer is strictly prohibited from providing a quotation until the Group Insurance Fact-Finding Form is fully completed and signed by both the client and the representative. Statement III is correct because the claims history from the previous three years is a vital requirement for the insurer to assess risk and determine the premium to be charged. Statement IV is correct because representatives are mandated to bring official industry guides, such as ‘Your Guide To Health Insurance’, to the attention of prospective clients and discuss them.

Incorrect: Statement II is incorrect because the ranking method is described as easier to manage but less equitable than the salary-based method; it is the salary-based method that accounts for length of service because more experienced staff typically earn higher salaries.

Takeaway: A valid group insurance quotation requires a signed fact-finding form and claims history, while the method chosen for sum assured determination affects how equitably benefits reflect employee tenure. Therefore, statements I, III and IV are correct.