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Nepal Insurance Authority Micro Life Insurance Agent Examination

Practice Questions
Exam Review

Key Facts: NIA Life Agent Exam

50

Objective questions, 2 marks each

NIA agent examination directive 2079, clause 9

1 hr 30 min

Time allowed

NIA agent examination directive 2079, clause 9

50%

Pass mark

NIA agent examination directive 2079, clause 12

NPR 500

Exam fee per sitting

NIA agent examination directive 2079, clause 7

3 years

Agent licence validity

Insurance Act 2079, section 91(3)

NIA's life insurance agent exam is a 50-question online objective test (2 marks each, 1 hour 30 minutes) with a 50% pass mark and a NPR 500 fee. Candidates need 10+2, insurer training and an insurer's recommendation; passing leads to a three-year agent licence costing NPR 2,500.

Sample NIA Life Agent Practice Questions

Try these sample questions to review concepts for the NIA Life Agent exam. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1In the risk unit of the life insurance agent syllabus, which statement best describes 'risk' (जोखिम)?
A.The certainty that a financial loss will happen on a known date
B.The premium an insurer charges for accepting a proposal
C.The possibility of an unfavourable outcome such as loss
D.The legal duty of the proposer to disclose material facts
Explanation: Risk is the uncertainty or possibility that an adverse outcome, such as a financial loss, may occur. Insurance exists because that outcome is possible but not certain. If a loss were certain, there would be nothing uncertain to insure.
2Which of the following is a pure risk that a life insurer can normally cover?
A.Premature death of a family's main earner
B.A fall in the price of shares bought on NEPSE
C.Losing money on a bet placed at a casino
D.A shop losing customers to a competitor's discount
Explanation: A pure risk offers only the chance of loss or no loss, and premature death of an earner is a classic insurable pure risk. Share trading, gambling and business competition are speculative risks because they also carry a chance of gain. Insurers do not cover speculative risks.
3A proposer smokes 30 cigarettes a day, which raises his chance of dying from heart disease. In the syllabus terms peril, hazard and loss (संकट, खतरा र नोक्सानी), what is the heavy smoking?
A.The peril that directly causes the loss
B.A hazard that increases the chance of loss
C.The loss suffered by the family
D.A risk transfer arranged by the insurer
Explanation: A hazard is a condition that increases the likelihood or severity of a loss. Heavy smoking is a hazard; a heart attack would be the peril, and the death and lost income are the loss. Underwriters look for hazards so they can price or limit the risk.
4A father buys a life policy so that his family will receive money if he dies early. Which method of risk management is he using?
A.Risk avoidance
B.Risk retention
C.Risk reduction
D.Risk transfer
Explanation: Buying insurance transfers the financial consequence of a risk to the insurer in return for a premium. The father cannot avoid the possibility of death, but he can transfer the resulting financial loss. Transfer is the method of risk management that insurance provides.
5Which event lacks the accidental (fortuitous) quality required for an insurable risk?
A.Death from a disease contracted during the policy term
B.Death from a fall while cutting fodder from a tree
C.Injury the insured deliberately causes to stage a claim
D.Death in a road accident while travelling by bus
Explanation: Insurers cover losses that happen by chance, not losses the insured deliberately brings about. A self-inflicted injury staged to collect money is not a fortuitous event and cannot be insured. NIA's life agent sample paper makes the same point about a deliberately caused accident.
6During underwriting, an agent learns that a proposer is in heavy debt and wants a sum assured far above his means, hinting he may stage his own disappearance. What kind of hazard does this show?
A.Physical hazard
B.Moral hazard
C.Occupational hazard
D.Environmental hazard
Explanation: Moral hazard arises from the dishonesty or bad intentions of a person, such as planning a fraudulent claim. NIA's sample paper uses moral hazard for claims involving concealment or inflated amounts. The agent must report such signs to the underwriter.
7Which statement best explains how insurance works as a system?
A.Each insured saves only for his or her own future loss
B.The insurer guarantees that no insured will ever suffer a loss
C.Government pays the losses of everyone who buys a policy
D.Premiums from many people in a pool pay the losses of the few
Explanation: Insurance pools premiums from many people exposed to a similar risk. Only a few of them suffer a loss in a given period, and the pooled fund pays those losses. This sharing of losses is the basic working system of insurance.
8Which statement correctly contrasts life insurance with non-life insurance?
A.Life policies pay an agreed sum; non-life policies indemnify an actual loss
B.Life policies are always one-year contracts; non-life policies run for decades
C.Only non-life insurance requires the principle of utmost good faith
D.Life insurance covers buildings and vehicles; non-life covers people
Explanation: A life policy is a contract to pay an agreed sum on death or maturity because a human life cannot be valued exactly. Most non-life policies are contracts of indemnity that restore the insured to the financial position before the loss. Non-life policies are usually short term, while life policies usually run for many years.
9A life insurer passes part of a large risk it has accepted to another insurance company. What is this arrangement called?
A.Co-insurance
B.Double insurance
C.Reinsurance
D.Self-insurance
Explanation: Reinsurance is insurance bought by an insurer to protect itself against part of the risk it has accepted. NIA's sample paper describes it as insuring the insurance. It lets the insurer accept larger risks while staying financially stable.
10Why does a life insurer want to insure a large number of people of similar age and health?
A.So that it can avoid medical underwriting for every proposal
B.So that its actual deaths come close to the deaths it expected
C.So that it can pay agents a higher rate of commission
D.So that it never needs to buy reinsurance
Explanation: Under the law of large numbers, the larger the group of similar risks, the closer actual experience comes to expected experience. This predictability lets the insurer set premiums accurately. It is a key part of how insurance and its feasibility work.

About the NIA Life Agent Exam

Nepal Insurance Authority (NIA) has held this online licensing exam for life insurance agents since Kartik 2080 (November 2023), under section 92(2) of the Insurance Act 2079, which requires intermediaries to pass a prescribed exam before licensing. This bank is independent practice by OpenExamPrep: an English-language MCQ study adaptation of NIA's 13-unit life agent syllabus, the Insurance Act 2079, the Insurance Regulations 2081 and NIA directives. It is not an official translation; NIA's syllabus and sample paper are in Nepali.

Exam sponsor: Nepal Insurance Authority (नेपाल बीमा प्राधिकरण). The requirements and fees below concern the certification or admission exam, separate from our free practice resources.

Assessment

One online objective paper covering the 13-unit life insurance agent syllabus annexed to the directive. After the insurer's recommendation is accepted in IRMIS, the candidate pays the NPR 500 fee, picks a session in the Agent Examination System, joins through Zoom with camera and microphone on, and answers on screen. NIA runs sessions from its central and provincial offices and shows the result after submission.

Time Limit

1 hour 30 minutes

Passing Score

50% (50 of 100 marks)

Exam / Certification Fees

NPR 500 per sitting

Exam sponsor website

Fees, eligibility, and exam policies can change. Confirm them with the exam sponsor before applying or paying.

Our practice resources: topics covered

We aim to reflect publicly available exam outlines and topic information in our study resources. Coverage, format, and difficulty may differ from the actual exam, and we cannot guarantee that every detail is accurate or current. Confirm exam requirements, fees, and policies with the official exam sponsor.

Not published

Unit 1: Risk and risk management

Meaning and classification of risk, insurable risk, peril, hazard and loss, and methods of risk management.

Not published

Unit 2: Introduction to insurance

Insurance, life and non-life insurance, purpose, types and benefits of insurance, how insurance works, and its potential.

Not published

Unit 3: Insurance agent

Types of agent, the agent's duties to insurer and insured, the insurer's duties to the agent, how to become an agent, professional importance and licence cancellation.

Not published

Unit 4: Principles of insurance

Utmost good faith, insurable interest, indemnity, proximate cause, subrogation and contribution, and which apply to life insurance.

Not published

Unit 5: Insurance policies

Types of life policy, policy terms, conditions and benefits, individual and group policies, riders, participating and non-participating plans, and premium tables.

Not published

Unit 6: Life insurance documents

Proposal form, KYC form, premium receipt, policy document, endorsement, riders, renewal notices and revival forms.

Not published

Unit 7: Premium and bonus

Premium and bonus calculation, paid-up and surrender values, policy loans, forfeiture and mortality tables.

Not published

Unit 8: Underwriting

Risk classification, preliminary, financial and medical underwriting, the agent's confidential report, occupational risk, underwriting manuals, nomination and assignment.

Not published

Unit 9: Claims

Claim process and documents, the agent's role, claim guidelines, and death, maturity, survival and rider claims.

Not published

Unit 10: Marketing of life insurance

The agent's profession, customer and after-sale service, consumer behaviour, ethical marketing and mis-selling.

Not published

Unit 11: Insurance agent and tax

Tax exemption scope in life insurance, the agent's remuneration and the tax on it, and the agent's tax registration.

Not published

Unit 12: Legal provisions on insurance

Insurance Act 2079, insurance regulations, the agent code of conduct, the Money Laundering Prevention Act 2064 and NIA's anti-money-laundering directive.

Not published

Unit 13: Insurance market

NIA, life, non-life and reinsurance companies, intermediaries, the Policyholder Protection Fund, insurance pools and the Insurance Development Fund.

Preparing for the NIA Life Agent Exam

What You Need to Know

  • Passing score: 50% (50 of 100 marks)
  • Assessment: One online objective paper covering the 13-unit life insurance agent syllabus annexed to the directive. After the insurer's recommendation is accepted in IRMIS, the candidate pays the NPR 500 fee, picks a session in the Agent Examination System, joins through Zoom with camera and microphone on, and answers on screen. NIA runs sessions from its central and provincial offices and shows the result after submission.
  • Time limit: 1 hour 30 minutes
  • Exam / certification fees: NPR 500 per sitting Official sources

Using Our Practice Resources

  • Work through all 100 available questions
  • Review every answer and explanation
  • Track weak areas and revisit them
  • Use our AI tutor for tough concepts

NIA Life Agent: Suggested Study Strategy

1Work through all 13 syllabus units; NIA's sample paper draws heavily on underwriting, premium and bonus, and the agent's role.
2Learn the key numbers in the Life Insurance Policy Directive 2079: a five-year minimum term, loans up to 90% of surrender value after three years, and automatic paid-up status after two years' premiums.
3Practise surrender value, paid-up value, bonus and commission calculations using NIA's Schedule 5 method and Schedule 9 of the Insurance Regulations 2081.
4Read the Insurance Agent Directive 2083 code of conduct and the claim deadlines in Rules 88 and 90 of the Insurance Regulations 2081.

Frequently Asked Questions

What is the format of the NIA life insurance agent exam?

It is an online objective test of 50 questions worth 2 marks each (100 marks) with 1 hour 30 minutes allowed. You need 50% to pass. The test runs on NIA's Agent Examination System through Zoom, and your camera and microphone must stay on throughout.

Who can sit the exam?

Under Rule 42 of the Insurance Regulations 2081, applicants must be Nepali citizens who have passed 10+2 or the Proficiency Certificate Level and completed insurance training, usually run by the insurer. The insurer enters the application with its recommendation in NIA's IRMIS portal before you can book a session.

How much does it cost to become a licensed life insurance agent?

The exam fee is NPR 500 per sitting. After you pass, the individual licence fee is NPR 2,500 under Schedule 7 of the Insurance Regulations 2081. The licence lasts three years and costs NPR 1,000 to renew.

Is this practice bank in the same language as the real exam?

No. NIA's syllabus and sample paper are in Nepali. These 100 questions are an English-language MCQ study adaptation of the same syllabus and laws, written independently by OpenExamPrep. They are not an official translation or NIA question bank.

What changed for life insurance agents in 2026?

NIA issued the Insurance Agent Directive 2083 in April 2026, tightening licensing and setting a code of conduct that includes a suitability test before recommending a policy. From 1 Shrawan 2083 (July 2026), tax withheld on commission paid to resident individual agents rose from 15% to 20%.