Insurance Licentiate exam study tips

Insurance Licentiate exam study tips

The insurance industry is often termed as a sunrise industry in India. Since liberalization and opening up the insurance sector for private players back in 2000, this sector has seen significant growth and still offers a huge future opportunity in a fast growing economy like ours.

In absolute terms all premium income, number of brokers, number of insurers, insurance penetration has gone up which is a good news. But as of 2015 insurance penetration which is ratio of premium underwritten to the GDP in India was 3.9% which is the far lower than world average of 6.3 percent in 2013. Apart from other growth catalysts like technology the necessity of skilled workforce is inevitable for growth of this sector. Insurance sector is often considered a sector with dire shortage of skilled and specialized workforce for all its verticals of underwriting, distribution, risk management, finance and accounts, product development, technology building and others. A survey estimated that there will be a requirement of around 20 Lakh insurance professionals in India by 2025.

Insurance industry regulator and statutory bodies have always stressed the need for formal training and a methodological approach to impart insurance education to every level of employees and workers joining the industry. The field of insurance as a formal academic discipline has gained momentum in recent years in India. There are numerous private, autonomous and government institutions mushrooming now a days offering formal degrees in insurance as a specialization.

There is a lack of knowledge and awareness in student community regarding examinations and certifications that are recognized nationally and internationally in field of insurance. In this article we will discuss about the Licentiate examination conducted by Insurance institute of India and will provide study tips and details about the examination.

Insurance institute of India more commonly known as III was established in the year 1955 and since then has contributed by promoting insurance education and training in the country. Today it offers post graduate and executive diploma programs in Insurance management, Health insurance and Insurance marketing, conducts IRDAI examinations for Surveyors, Insurance agents, corporate agents, insurance marketing firms and web aggregators. Apart from that it organizes online training for brokers, offers a few good certificate programs. Licentiate Associateship and Fellowship are three stages for which the candidate has to acquire credit points to earn the respective designations.

Scheme of the examination: –

Licentiate: – This is the first level of examination and requires basic knowledge on the two broader disciplines of Life and General Insurance. Candidates need to acquire 60 Credit Points with two compulsory papers being cleared. Examination is conducted online at designated III centres in major Indian cities.

Compulsory Subject Credit Points
IC 01 Principals of Insurance 20
IC 02 Practice of life Insurance 20
IC 11 Practice of General Insurance  
Any one optional paper At least 20

Licentiate designation is granted by III and certificate is provide to the candidate for completing the same.

Associateship: – This is the second level of examination and requires practical aspect knowledge to a wide range of insurance subjects. Candidate can choose subjects of his choice from fields of life insurance, general insurance or both combined. In addition to 60 credits gained for licentiate examination candidate has to acquire 190 Credit points and pass two compulsory papers. That in total of 240 credit points is needed to earn the Associateship designation of III.

Compulsory Subject Credit Points
IC 22 Life Insurance Underwriting 30
IC 45 General Insurance Underwriting  
IC 26 Life Assurance Finance 30
IC 46 General Insurance Accounts and  
Regulation of Investment  
Combination of optional subjects At least 130

Fellowship: – This is the third and final level and requires specialized knowledge from various verticals of Insurance. In addition to 250 credits gained for licentiate and associate examination the candidate has to acquire 240 Credit points and pass one compulsory paper. That in total of 490 credit points is needed to earn the Fellowship designation of III. Fellowship designation is granted by III and certificate is provided conferring the designation on the candidate.

Although examination most of the subjects are conducted online in multiple choice questions format some subject exams are conducted in paper pen based format also and is in subjective nature. Duration of examination is 2 hours and pass marks is 60% or above to earn a distinction the student need to score 75% or above.

The fellowship designation and credits earned from Insurance Institute of India has gained reputation in the industry and can be used to get exemption for a few selected credits from some international bodies providing similar certifications (CII – London offers some exemptions for credit points and fellowship designation earned from III.

Study Material: – III publishes study materials for all compulsory and optional subjects which is directly dispatched to the address of the candidate after ordering them online.

Application for the examination: – Online fees is to be paid for registration of all the three levels at the Insurance institute of India website and slot booking of centre, date and time of examination is to be performed online as well in stipulated dates as disclosed on the III website. Examination is co

Tips for succeeding in the Licentiate examination: – First we will introduce the subjects and recommend some optional papers that can be considered by the student for licentiate exams.

Principles of Insurance IC 01: – The objective of this paper is to familiarize the student with basic principles of Insurance which are the pillars on which the insurance industry operates. Principle of utmost good faith, Insurable interest, indemnity, proximate cause are most important and needs to be understood very well at this level to grasp the concepts developed on these basic principles which is the subject matter in higher levels of the examination.

Practice of Life Insurance IC 02: – This paper is an introduction to basic life insurance principals, terminology used and the operative mechanism behind it. This subject lays the foundation on which the other life insurance subjects of Associateship and fellowship are based on.

Practice of General Insurance IC 03: – This paper is an introduction to basic general insurance principals, terminology used and the operative mechanism behind it. This subject also introduces us to various other branches of General Insurance namely Property and Casualty. This subject lays the foundation on which the other General insurance subjects of Associateship and fellowship are based on.

Optional Paper: – Although the candidate can select its optional subject of 20 Credits from a broad range of subjects. At this stage it is recommended to go ahead with a basic foundational subject which can lay a good base for higher levels as per interest of the candidate and his/her scope of work. One of the recommended papers that a student can opt is IC 14 Regulation of Insurance business.

5 Simple Tips to clear: –

1.Studying the study material published by III and going through the MCQ provided therein is more than sufficient to pass Licentiate level.

2.Complete all the chapters of the study material at least in one glance and stress on the concepts as the questions can be sometimes application based.

3.If the student has selected IC 14 Regulation of Insurance business as the optional paper remembering the dates of the regulations passed is important.

4.Getting well acquainted with the computer based test is very important. While appearing first time the student should spend some time to build up the familiarity.

5.Although the multiple choice questions are basic the candidate should spend the full time available (2 hours) in reviewing the answers and cross checking as the options can be sometimes close. Once submitted the test the candidate can’t go back and make corrections.