The IC 02 Mock Test on SarkariExam.center gives you 100 MCQs in 120 minutes with no negative marking, built on the Insurance Institute of India (III) Licentiate exam pattern for Practice of Life Insurance. Passing requires 60 out of 100. Every chapter from the III official IC-02 syllabus is covered, including Assignment and Nomination, Claims Settlement, Surrender Values, ULIPs, and IRDAI Regulations.
IC 02 Exam Pattern: Practice of Life Insurance Licentiate
The Insurance Institute of India (III) conducts the IC-02 Practice of Life Insurance exam 4 times every year as an online Computer-Based Test. The structure is fixed and does not change between exam sessions.
| Feature | Details |
|---|---|
| Total Questions | 100 MCQs |
| Time Duration | 120 minutes (2 hours) |
| Marks Per Question | 1 mark each |
| Passing Marks | 60 out of 100 (60%) |
| Negative Marking | None |
| Exam Mode | Online Computer-Based Test via III portal |
| Exam Frequency | 4 times per year (quarterly exam windows) |
| Conducted By | Insurance Institute of India (III) |
| Paper Code | IC 02 / IC-02 |
| Companion Papers | IC 01 (Principles of Insurance) and IC 14 (Regulation of Insurance Business) |
No negative marking means every unattempted question scores zero guaranteed. Attempt all 100 questions. Even on unfamiliar topics, a random attempt carries a 25% probability of scoring 1 mark.
IC 02 Licentiate: Who Needs to Clear This Exam
The IC-02 Practice of Life Insurance paper is a mandatory Licentiate exam subject for all insurance professionals working in life insurance in India. Failing IC 02 blocks service confirmation and promotion eligibility across all categories.
- LIC employees: Life Insurance Corporation of India staff need the Licentiate qualification for service confirmation and promotion from clerical to officer grade
- Private life insurer staff: Employees at HDFC Life, ICICI Prudential Life, SBI Life, Max Life, Bajaj Allianz Life, Kotak Life, and all IRDAI-licensed private life insurers
- Public sector insurer staff: Employees at New India Assurance, National Insurance Company, Oriental Insurance, and United India Insurance in life-linked roles
- Licensed insurance agents: Individuals with an IRDAI agent licence seeking to strengthen product knowledge and certification credentials
- Promotion seekers: Insurance employees where the III Licentiate certificate is a mandatory condition for moving to managerial or officer-level positions
- GIPSA exam candidates: Staff appearing in GIPSA promotion exams where III Licentiate papers form part of the assessment framework
- Para 13.2 exam candidates: LIC employees appearing in Para 13.2 internal promotion exams that require Licentiate level knowledge
IC 02 Chapter-Wise Weightage and Priority
Assignment and Nomination alongside Types of Life Insurance Products are the two highest-scoring chapters, together contributing 27 to 35 questions per IC 02 paper. Use this weightage table to allocate your preparation time correctly.
| Chapter | Questions Per Paper | Difficulty | Priority |
|---|---|---|---|
| Types of Life Insurance Products | 15 to 20 | Medium | Highest |
| Assignment and Nomination | 12 to 15 | Medium | Highest |
| Claims Settlement Procedure | 10 to 15 | Medium | High |
| Group Insurance and Pension Plans | 10 to 12 | Medium | High |
| Premium Calculation and Policy Conditions | 8 to 12 | Medium to Hard | High |
| Surrender and Paid-Up Values | 8 to 10 | Hard | High |
| Life Insurance Regulations and IRDAI | 8 to 10 | Medium | Medium |
| Marketing and Distribution Channels | 6 to 8 | Easy | Medium |
| Introduction to Life Insurance | 5 to 8 | Easy | Medium |
| LIC and Private Insurer Operations | 5 to 7 | Easy | Low |
IC 02 Mock Test: Chapter-Wise Topics Covered
SarkariExam.center IC 02 Mock Tests cover every chapter of the III official syllabus for Practice of Life Insurance. Below are the specific topics that III question papers test most often in each chapter.
Types of Life Insurance Products (15 to 20 Questions)
This chapter carries the highest question count in IC-02 and rewards candidates who build a comparison table across all product types. Topics include term insurance, endowment plans, money-back policies, whole life insurance, Unit Linked Insurance Plans (ULIPs), child insurance plans, joint life policies, and rider benefits.
- Feature differences between each product type
- Suitability for different customer profiles and income levels
- Premium structures for term vs endowment vs ULIP products
- Surrender value provisions specific to each product category
- Rider benefit options like accident benefit rider, critical illness rider, and waiver of premium
Assignment and Nomination: Section 38 and Section 39 (12 to 15 Questions)
Assignment and Nomination is the most tested chapter per question density and where most IC 02 candidates lose avoidable marks. The Insurance Act, 1938 governs this chapter under Section 38 (Assignment) and Section 39 (Nomination).
- Difference between assignment and nomination in rights transferred
- Types of assignment: conditional assignment and absolute assignment
- Section 38: assignment requires written notice to the insurer and insurer endorsement
- Section 39: nomination designates who receives the death claim benefit without transferring ownership
- Rights of assignee versus rights of nominee in claim scenarios
- Simultaneous assignment and nomination: which takes precedence
- Documentation requirements and insurer responsibilities under each provision
Claims Settlement Procedure (10 to 15 Questions)
Claims questions test the complete process from intimation to final payment for death claims, maturity claims, and survival benefit claims. Edge-case scenarios appear in most IC 02 exam papers.
- Required documents for death claims, maturity claims, and survival benefit claims
- Accidental death claim documentation and additional requirements
- Suicide clause: claims payable after 2 years from policy commencement date
- Death during the free-look period: full refund provisions apply
- Claims under the Married Women’s Property Act (MWP Act): trustee appointment and separate claim process
- Reasons for claim rejection and appeal procedures through the Insurance Ombudsman
- Processing timelines mandated by IRDAI for death and maturity claims
Group Insurance and Pension Plans (10 to 12 Questions)
Group insurance questions in IC 02 focus on EDLI (Employees Deposit Linked Insurance), gratuity schemes, and superannuation alongside annuity product types.
- EDLI: Employees Deposit Linked Insurance scheme under EPFO
- Group term insurance: eligibility, master policy structure, and claims under group cover
- Gratuity and leave encashment insurance structures
- Annuity types: immediate annuity, deferred annuity, life annuity, annuity certain, life with return of purchase price, and joint life annuity
- Tax treatment of premium paid and benefits received under group policies
- Superannuation fund structure and regulatory requirements
Premium Calculation and Policy Conditions (8 to 12 Questions)
Premium questions test loading factors, bonus types, premium frequency, and factors that affect the base premium rate. Numerical premium calculation questions carry the highest per-question difficulty in IC 02.
- Factors affecting premium: age, sum assured, policy term, health, and occupation
- Loading: extra premium for high-risk lives, female lives, and sub-standard lives
- Bonus types: reversionary bonus, terminal bonus, and interim bonus
- Grace period rules: 15 days for monthly premiums and 30 days for other modes
- Free-look period: 15 days for regular policies and 30 days for policies sold through distance marketing
- Policy loan provisions: maximum percentage of surrender value available
- Revival of lapsed policy: conditions and documentation for reinstatement
Surrender and Paid-Up Values (8 to 10 Questions)
Surrender value questions provide 4 inputs: premium paid, term completed, sum assured, and bonus accumulated, then ask you to calculate the payable amount. Practice these calculations until each type takes under 60 seconds.
- Guaranteed surrender value formula: 30% of premiums paid excluding first year premium and riders
- Special surrender value formula: paid-up sum assured plus bonus attaching, reduced by a surrender factor
- Paid-up sum assured calculation: original sum assured multiplied by premiums paid divided by total premiums payable
- Which surrender value is payable: always the higher of guaranteed surrender value and special surrender value
Life Insurance Regulations and IRDAI (8 to 10 Questions)
IRDAI regulation questions test specific section references, investment norms, solvency margin requirements, and consumer protection provisions under the Insurance Act, 1938.
- IRDAI investment norms: minimum percentage in government securities and approved investments
- Solvency margin requirements for life insurers under IRDAI regulations
- Policy document guidelines: mandatory fields and delivery timeline to policyholder
- Grievance redressal: IRDAI Integrated Grievance Management System (IGMS) and timelines
- Insurance Ombudsman: jurisdiction limits, complaint categories, and award binding nature
- Married Women’s Property Act (MWP Act) application to life insurance policies
3 Topics That Decide Your IC 02 Score
3 topic areas together account for 40 to 50 questions in every IC 02 paper. Getting all 3 right puts you well above the 60% pass mark before even attempting the remaining chapters.
Age Calculation: Next Birthday vs Previous Birthday
Age calculation questions appear in 6 to 7 questions per IC 02 paper and cascade into wrong premium and surrender value answers if you use the wrong method.
- Age next birthday: always rounds up to the next whole year regardless of months completed
- Age previous birthday: uses the last completed year, always rounds down
- Most life insurance products use age next birthday for premium calculation purposes
- Practice 10 age calculation problems daily in the first week of preparation
Surrender Value Formula Applications
Surrender value questions in IC 02 always provide the same 4 inputs: premium paid, term completed, sum assured, and accumulated bonus. Write both formulas on your rough sheet before answering the first question in the actual exam.
- Step 1: Calculate guaranteed surrender value using the 30% rule
- Step 2: Calculate special surrender value using paid-up sum assured multiplied by the surrender factor
- Step 3: Report whichever value is higher as the payable surrender amount
ULIP and Annuity Product Features
ULIPs and annuity products each carry 4 to 6 questions and are the most skipped topics during IC 02 preparation. Skipping them consistently drops scores below 60.
- ULIP key charges: premium allocation charge, fund management charge, mortality charge, policy administration charge, and surrender charge
- ULIP switching: number of free switches allowed per year and charges beyond the free limit
- ULIP partial withdrawal: lock-in period of 5 years and minimum partial withdrawal conditions
- 6 annuity types tested in IC 02: life annuity, annuity certain, life with return of purchase price, joint life annuity, deferred annuity, and immediate annuity
7 Mistakes That Drop IC 02 Scores Below 60
These errors cause most IC 02 failures across multiple exam cycles. Fixing all 7 before exam day typically adds 8 to 12 marks to your score.
- Confusing assignment with nomination: Assignment transfers policy ownership; nomination designates the beneficiary only. Mixing these 2 concepts costs 6 to 8 marks alone.
- Wrong age calculation method: Using age next birthday when the question specifies age previous birthday produces wrong premium and value answers.
- Incomplete claims document lists: Memorise the full document list for death claims, maturity claims, and accidental death claims separately. Partial recall causes pattern errors.
- Skipping ULIP and annuity questions: These product categories appear in 8 to 10 questions. Candidates who skip them during preparation consistently score below 60.
- Missing the final sentence of each question: IC 02 questions frequently place the answer condition in the last sentence. Words like “except,” “incorrect statement,” or “not applicable” reverse the correct answer.
- Spending more than 90 seconds on one question: At 100 questions in 120 minutes, each question averages 72 seconds. A 3-minute question eliminates your buffer for numerical questions.
- Leaving questions blank: No negative marking means an unattempted question is a guaranteed zero. A random guess carries a 25% chance of scoring 1 mark.
IC 02 Score Improvement Plan Using Mock Tests
Candidates who follow a mock test schedule score 8 to 12 marks higher in IC 02 than candidates who only re-read the III study material. Use this practice plan for 4 weeks before your exam window.
Week 1: Build Topic Mastery for High-Weightage Chapters
- Create a single product comparison table across all 8 life insurance product types
- Study Section 38 and Section 39 of the Insurance Act with flashcards for each provision
- Memorise the full claims document list for all 5 claim categories
- Solve 10 age calculation problems and 10 surrender value problems daily
Week 2: Attempt Chapter-Wise Mock Tests
- Attempt 1 chapter-wise test per day for the 3 highest-weightage chapters
- Review every wrong answer with the solution explanation immediately after each test
- Build an IRDAI regulation reference sheet with section numbers and exact requirements
- Cover ULIP charges, switching rules, and all 6 annuity types in 3 dedicated sessions
Week 3: Full Mock Test Rotation
- Attempt 1 full 100-question IC 02 Mock Test every 2 days
- Spend equal time reviewing wrong answers as you spent taking the test
- Identify your 2 lowest-scoring chapters and repeat chapter tests for those topics
- Score should improve by 5 to 8 marks between the first and third full mock test
Week 4: Final Exam Simulation
- Attempt 2 timed full mock tests this week under exam conditions
- Review the IRDAI regulation reference sheet daily
- Write surrender value and paid-up value formulas from memory 3 times before exam day
- Target a consistent score of 70 or above in mock tests before your actual exam window
IC 02 Mock Test and the III Licentiate Framework
IC 02 Practice of Life Insurance is 1 of 3 papers in the Insurance Institute of India Licentiate examination for the life insurance specialisation. All 3 papers must be cleared to earn the Licentiate certificate.
- IC 01 (Principles of Insurance): common paper for both life and general insurance candidates
- IC 02 (Practice of Life Insurance): compulsory for life insurance Licentiate candidates
- IC 14 (Regulation of Insurance Business): common paper for both life and general insurance candidates
Candidates choosing the general insurance specialisation replace IC 02 with IC 11 (Practice of General Insurance). The III Licentiate examination is a credit-based system with no overall time limit for completing all 3 papers, though credit points for passed subjects remain valid for 5 years.
IC 02 Mock Test: Frequently Asked Questions
The IC 02 exam has exactly 100 MCQs completed in 120 minutes (2 hours). Each question carries 1 mark. Passing requires 60 correct answers out of 100. There is no negative marking, so attempt all 100 questions including those where you are unsure.
Types of Life Insurance Products carries 15 to 20 questions per paper, making it the highest question-count chapter in IC 02. Assignment and Nomination follows with 12 to 15 questions. These 2 chapters alone account for 27 to 35 questions, which is more than a quarter of the full exam.
Yes, most IC 02 candidates pass through self-study using the Insurance Institute of India official study material plus regular mock test practice. The key requirements are attempting at least 10 full-length mock tests, reviewing every wrong answer with solution explanations, and focusing preparation on the 3 highest-weightage chapters: product types, assignment and nomination, and claims settlement.
The Insurance Institute of India conducts the IC 02 Licentiate exam 4 times every year in quarterly exam windows. Candidates who do not pass in one window can register for the next available window. The III places no limit on the number of attempts, so candidates can appear until they achieve the 60% passing mark.
The IC 02 exam gives you an average of 72 seconds per question based on 100 questions in 120 minutes. Allocate 45 to 60 seconds for theory-based questions like definitions and regulatory provisions. Allow up to 90 seconds for numerical questions such as surrender value calculations and premium computation. Skip any question exceeding 90 seconds on the first pass and return after completing all easier questions.
