[amp_mcq option1=”The value of the units” option2=”The number of units standing to the credit of the unit holder” option3=”Both A & B” option4=”None of the above” correct=”option3″]
The correct answer is C. Both A & B.
A unit-linked insurance policy is a type of life insurance policy that invests the premiums paid into a fund of units. The value of the units in the fund will fluctuate over time, depending on the performance of the underlying investments. The benefit payable under a unit-linked policy will therefore be based on the number of units standing to the credit of the unit holder and the value of each unit.
Option A is correct because the value of the units in the fund will determine the amount of the benefit payable. Option B is also correct because the number of units standing to the credit of the unit holder will also determine the amount of the benefit payable. Option C is therefore the correct answer.
Option D is incorrect because both the value of the units and the number of units standing to the credit of the unit holder will determine the amount of the benefit payable.