AXA BASIC COURSE AGENCY EXAM

NAME:Nino Rejhi J. Natividad Score:________

Date:MARCH 13, 2014 Trainer: MS. MARY ERIKA GATUS

I. Product Case Scenarios:

Instructions: Read the questions carefully and write the correct answer on the space provided.
(16pts total)

1. Hilario got a 2 Million Sum Insured LifeBasiX Plan with level death benefit. After six (6) years he
already has 500k in his account value. On his policy anniversary, he made a withdrawal of 300k.
Unfortunately after 3 months he passed away. How much will his family get? Why? (2pts)

ANS. 2,000,000 – 375,000(300,000*125%)= P1,625,000 is the total death benefit the the family will
receive because the sum insured will be deducted for any partial withdrawal which is 125% of 300,000.

2. Narda decided to purchase an aXelerator with a Sum Insured of 500k. After 4 years, she has an
account value of 400k. Due to a family emergency she withdrew 200k from her account value. How
much will she receive? (1 pt)

ANS. SUM INSURED:500,000

ACCOUNT VALUE:400,000
LESS WITHDRAWAL: 200,000
TOTAL: 200,000 BUT SINCE IT’S STILL IN THE 4TH YEAR; A WITHDRAWAL CHARGE OF 10% SHALL BE
DEDUCTED TO THE TOTAL AMOUNT WITHDRAWN.
P200,000- 20,000(200,000*10%)
THE AMOUNT THAT SHE WILL BE P180,000.

3. Enteng is a little bit confused with the difference of Level Death Benefit and Increasing Death Benefit.
To give him a better idea, shade where the Net Amount at Risk will be found for each of the death
benefits. (2pts total, 1pt each)
4. Juan Rico wants a plan that will not just give him insurance protection, but also investments so that he
may save until his retirement age. With this he decided to get Retire Smart. Give 3 features and benefits
that Retire Smart will be able to offer (3pts total, 1pt ea benefit)

FEATURE BENEFITS
Regular and Single Top-Ups Increase the Client’s Coverage through Top-Ups
NO BID OFFER Client is able to buy 5% more units at the onset
and every top-up
LOYALTY BONUS Additional Investments given at specific periods at
no extra cost for the client

5. Flavio is torn between getting aXelerator and Life BasiX. As his Financial Advisor, enumerate 4 key
differences between aXelerator and Life BasiX? (4pts total, 1pt ea difference)

FEATURE LIFE BASIX AXELERATOR

MINIMUM SUM INSURED P400,000 P150,000
PREMIUM CHARGE-4TH YEAR 35% TH
4 YR & UP 0%
DEATH BENEFIT INCREASING AND LEVEL LEVEL
LOYALTY BONUS GUARANTEED 5% FOR Y15 AND GUARANTEED 5% FOR Y10 AND
Y25 BASED ON AVE. ACCOUNT Y20 BASED ON AVE.ACCOUNT
VALUE OVER THE PAST 10 YEARS VALUE OVER THE PAST 1O YEARS
6. Ricardo Dalisay has had his Life BasiX policy for a year. He was surprised one day to find that his
premiums had increased by 5%. He is now furious and feels deceived. As a Financial Advisor, can you
explain what just happened to his policy? (2 pts)

ANS. Based in the Index Link Increase Endorsment, it may increase the basic sum insured and rider
sum insured based on the increase premium not later than 30days on each policy anniversary.
Increase to follow CPI subject to a 5% minimum that is calculated due to inflation.

7. What is Premium Holiday? What are the benefits and detriments of availing this feature? (2pts)

ANS. The premium holiday feature refers to the use of the fund’s available account value to settle
applicable policy charges if regular policy premium remains unpaid after the grace period.

II. Need Computation: Solve for the need based on the details found below. Show your solution.
(5pts total, 1 pt per step)

Client: Leandro Montemayor

Monthly Income: Php 80,000.00
Age: 35
Need: Retirement

Step 1: SALARY IS P80,000 WHICH FALLS UNDER BRACKET C

Step 2: MONTHLY EXPENSE RATE IS 55%
Step3: MONTHLY INCOME X MER = P44,000
Step 4: 44,000 x 12 = 528,000
Step 5: 528,000 x 15 = 7,920,000
III. Proposal Generation
Instructions: Generate a proposal given the following details and answer the questions below. Use
Direct to Proposal. (9pts total)

Details:
Client Name: TEST, (your first name) (last name) Need: Retirement
Gender: Male Product: Retire Smart
Birthdate: January 1, 1990 Protection Level: x10
Sum Insured: 1.5 Million (Insure this is the SI reflected
Email: ABCTEST@gmail.com
in the proposal)
CP#: 0910-751-4444 Retirement Fund: 2045
Occupation: Accountant RidersAttached: Care Premier and Waiver of Premium
Monthly Income: Php 120,000.00 Regular Top Up: 10k
Lumpsum Top up: 50k on Policy year 10
Withdrawal: 200k on Policy year 35

1. What is the 8% Living Benefit at target date 2045? P11, 611,859

2. What is the annual premium of the plan? P172,754.80

3. What is the definition of CARE rider in the proposal? CARE PREMIER-Php 2000 for daily
hospitalization benefit cover up to age 71 with SUM ASSURED OF 2M and 4,754.80 annual premium

4. How much is the annual premium for Waiver of Premium?P 18,000

5. How much is the monthly premium for the entire proposal? P14,396.35

6. At policy year 20, what is the living benefit illustrated at 4% rate of return?P 4,216, 119

7. At age 65, how much is the living benefit illustrated at 10% rate of return? P40, 873,204

8. What are the two fund strategies illustrated in the proposal? RETIRE SMART & CARE PREMIER

9. How many pages is the proposal, and what is the last page titled? 8 pages FINANCIAL STANDING
SUMMARY