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Certificate Examination in Investment-Linked Life Insurance (CEILLI) Free Practice Test

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Aii lists 60 questions in 90 minutes, with a 50% pass mark. Intended sellers must first be contracted as life agents. Confirm current qualification, appointment and LIAM registration requirements with Aii and the principal.

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A retiree needs most savings next year. Why may an equity-heavy fund be unsuitable despite enthusiasm for risk?

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Unit Ledger: Follow Money, Units and Charges

Reconcile a premium to closing unit value, distinguish allocation from returns, and calculate why lower prices increase unit cancellation for a fixed charge.

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The premium is not the closing account value

Mei pays twelve hundred ringgit into a fictional investment-linked life policy. Assume eighty percent is allocated to units, the purchase price is one ringgit twenty sen, and there are no other deductions at purchase. Later the valuation price falls to one ringgit and a sixty ringgit policy charge is funded by cancelling units at that price. What account value remains? This CEILLI exercise uses stipulated numbers to separate allocation, market movement and charges instead of calling every difference an investment loss.

Allocate first, then divide by the price

Eighty percent of twelve hundred is nine hundred sixty ringgit allocated to investment. Divide that amount by the one ringgit twenty purchase price to obtain eight hundred units. The remaining two hundred forty was not allocated to these units under the example's assumptions; its contractual purpose would need explaining from the actual policy. Multiplying money by price would not calculate unit quantity. Keep the premium, allocated amount and number of units as three separate entries.

Value the holding, then cancel units for the charge

At the later price of one ringgit, eight hundred units are worth eight hundred ringgit before the charge. A sixty ringgit charge at that price requires cancellation of sixty units, leaving seven hundred forty. The closing account value is therefore seven hundred forty ringgit. Assume no other transactions, taxes, spreads or deductions apply. The charge does not change the quoted unit price in this example; it reduces the number of units belonging to Mei's policy account.

The exam trap: label the whole gap a market loss

Mei paid twelve hundred and now has seven hundred forty, a difference of four hundred sixty ringgit. But only one hundred sixty came from the price falling on the purchased units. Another two hundred forty was never allocated to them, and sixty funded the later charge. Those three amounts reconcile the difference. Account value is not automatically surrender proceeds either, because an actual contract may apply further adjustments. Explain the distinct cash flows rather than offering a misleading single return figure.

Mini-check: a lower price cancels more units

Restart from the same eight hundred units immediately after purchase. Suppose the later price is eighty sen instead, and the same sixty ringgit charge is then deducted once. How many units are cancelled? Sixty divided by eighty sen is seventy five units. Seven hundred twenty five units remain, worth five hundred eighty ringgit. Do not carry forward the earlier sixty-unit cancellation, because this is an alternative scenario. A fixed money charge consumes more units when their price is lower.

Use a ledger before discussing performance

For the next investment-linked problem, record five things: premium paid, amount allocated, units purchased, units cancelled and the final valuation price. Apply each transaction once and use the correct price for that transaction. Then distinguish account value, surrender proceeds and the policy's protection benefit rather than treating them as interchangeable. This method supports accurate product explanations and sustainability reviews. An illustration's attractive growth assumption cannot remove allocation costs, ongoing charges or the possibility that markets fall.

In this lesson

  1. 1.The premium is not the closing account value
  2. 2.Allocate first, then divide by the price
  3. 3.Value the holding, then cancel units for the charge
  4. 4.The exam trap: label the whole gap a market loss
  5. 5.Mini-check: a lower price cancels more units
  6. 6.Use a ledger before discussing performance

Aligned to the Official programme syllabus. Independent teaching with original examples; this focused lesson does not cover the entire syllabus.

Exam Syllabus

Core Certificate Examination in Investment-Linked Life Insurance (CEILLI) topics

01

Investment Principles and Risk

Risk and return | Inflation | Investment horizon | Compounding

02

Investment Vehicles and Diversification

Equities | Bonds | Money markets | Diversification

03

Investment-Linked Policy Structure

Protection and investment | Unit funds | Death benefit formulas | Allocation

04

Unit Pricing Charges and Calculations

Units purchased | Unit cancellation | Bid-offer spreads | Fund returns

05

Policy Sustainability and Servicing

Insurance charges | Premium holidays | Withdrawals | Sustainability reviews

06

Suitability Disclosure and Ethics

Fact finding | Risk capacity | Benefit illustrations | Replacement and disclosure

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Which examination route does this cover?

CEILLI focuses on investment-linked life insurance. Aii states that candidates intending to sell these products must first be contracted as life insurance agents. Confirm all appointment and LIAM registration requirements with Aii and the prospective principal.

Does passing automatically authorise me to sell?

No. Examination success is an entry qualification. Appointment by a relevant principal and registration with LIAM, together with applicable requirements, must be completed before transacting business.

Are these official examination questions?

No. These are independently authored learning exercises, not Aii or MTA questions, leaked items, recalled live questions or a guarantee of passing. Product wording controls actual benefits; numbers in exercises are stipulated examples.

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