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Quiz 16
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Q.1
Which is correct
It may lead to community rating
It may lead to abuse of health insurance cover
Moral Hazard in health insurance would mean adverse selection
Risk pooling will be there in moral hazard
Q.2
Which is incorrect?
Ombudsman is appointed by the central Govt under powers of the Insurance Act’38 and under Redressal of Public Grievance Rules 1998
The recommendations of the Ombudsman are always binding on the insured
The Ombudsman can act as a mediator by mutual agreement between the insurer and the insured
If mediated, the decision of the Ombudsman is final whether to accept or reject the compliant
Q.3
Which is correct
By transferring risks to an insurer one can be careless about one’s assets
If there is a loss it can lead to payment of money by the insurer
Potential loss to assets can be ignored
If assets are insured the owner of such assets can have comfort of peace of mind and look after his business without worries
Q.4
Life Insurance marketing differs from marketing of products and services because
Life insurance needs to be sold, rather than bought
Life insurance is intangible unlike a tangible product
Value of life insurance is not seen at the time of purchase unlike a consumable product
All of the above
Q.5
What is known as cold call?
It is direct approach of the prospect for insurance purposes without any prior announcement or appointment
Cold call is not with warmth of familiarity or friendliness
It is without any energy or hope as to the result of the effort
Cold call is an aimless exercise not serious about the final outcome
Q.6
State the correct option
In a policy document it is now compulsory to indicate the address of the local Ombudsman
Address of the insured is optional in the policy document
The address of the IRDA is also necessarily shown in the policy document
Either the local ombudsman’s address or that of the IRDA needs to be shown in the policy
Q.7
Which of the following is a contingency product
Shares
Bonds
Life insurance
Bank Deposits
Q.8
State the incorrect sentence.
Free look period enables the insured to return the policy within 30 days of receipt of the policy bond
If the policy is returned as above, no premium is refunded by the insurer
PMLA is not applicable to life insurance
All of the above
Q.9
Identify the correct statement out of the following ones.
In emergencies insurer may waive preauthorisation for entering into a hospital for treatment
In all cases preauthorisation either by the insurer or TPA is a must before getting admitted into a hospital
There is no provision for nomination in a health insurance cover
Summary of benefits, terms and conditions for each product in a health cover is not mandatory
Q.10
Identify the correct statement
Assets are protected by insurance
Insurance prevents loss to assets
Insurance compensates for the loss of the value of assets
Probabilities of loss are considerably reduced by insurance
Q.11
Which is correct
In insurance subsidy plays a part in fixing premium
Losses are shared by subsidy
A few persons have to share the loss of many
Losses of a few persons are shared by many persons thus reducing the burden of contribution to loss compensation
Q.12
Which of the following statement is correct?
Endowment assurance has no saving element
Whole Life Plan has no saving element at all
Term Insurance has little or no saving element
Money Back plan has no savings element
Q.13
Key to successful closing is helping the prospect to say
No, not at this stage
Don’t know
Yes
I will have to think again
Q.14
Pick out the incorrect statement.
As per law if the premium, for three years, it shall earn a guaranteed surrender value
With discontinuance of premium even after three years no surrender value is guaranteed
The special revival of a lapsed policy is convenient both from the assured point of view and that of the insurer
The most important condition for a policy lapsed for a considerable length of time is evidence of insurable interest
Q.15
Pick out the correct statement.
If a claim arises in a policy with the death of the assured and if the due premium is not paid and as grace period has not expired, claim will be paid only for The assignment value
Nomination is governed by Sec 38 of the Insurance Act1938
In the above case full claim for the original sum assured will be paid after deducting the unpaid premium
The assignment is governed by Sec 39 of the Insurance Act’1939
Q.16
State the incorrect sentence.
In assignment the rights of the assured are transferred to the assignee
There is no difference between nomination and assignment
In a policy loan the loanee-policyholder is not obligated to pay off the loan
As a general rule, no alteration is allowed in the first year of the policy
Q.17
Pick out the incorrect statement.
Material information is required by the insurer about a proposer for correctly estimating risk in his life for life cover purposes
All information as contained in the proposal is equally binding on the parties to a life insurance contract
Proposal is not always necessary from proposer’s point of view
IRDA has The proposal proposal form since 2013
Q.18
Identify the incorrect statement.
A policy has three parts viz. Policy schedule, standard provisions & special policy provisions
A policy is the most important document evidencing the relationship between life assured and the insurance company
With issue of FPR further premiums are not required to be paid
Any interpretation of a complex provision of the policy in case of conflict should be in favour of the assured
Q.19
State the incorrect statement.
Code of conduct is optional for a successful agent
Ethical standards may sometimes conflict with drive to do good volume of business
Persistency of policies is beyond the control of agents as well as the insurer
All of the above
Q.20
State the correct option
Premium paid by a client for health cover enjoys income tax deduction under 80.C of the Income Tax Act
Premium paid towards health cover earns income tax rebate under sec.80D of the Income Tax Act
Premium paid for a health cover does not qualify for tax benefit under any provision of the Income Tax Act
There is no upper limit to sum assured in a health insurance policy
Q.21
What is the grace period allowed by the Regulator for renewal in health insurance policy?
60 days
45 days
30 days
15 days only
Q.22
State the correct options
ULIPS are bundled products
ULIPS have clear aspects of term, expenses and savings components
In ULIP Plans the investment risk is borne by the Insurer
Value of units is determined in advance as per a formula of the Insurer
Q.23
State the correct statement
As per IRDA norms ULIPs are allowed but not Variable life plans
Only variable plans are allowed but not ULIP policies as per IRDA norms
Neither of the above plans is allowed in India
Both plans are allowed by the IRDA in India. State the correct statement
Q.24
Liquidation period refers to
Time taken to build up a corpus
Period during which Annuity payments are made by the insurer
Insolvency period
Time between purchase of annuity and start of payment of annuity payments by the insurer
Q.25
What is the essential feature of an MRI?
To bargain for cheaper mortgage rates from loan provider
To continuously protect the value of the mortgaged property
To escape court action of attachment in case of default or indebtedness
To act as a collateral for ensuring financial protection for home loan borrowers
Q.26
Identify the correct statement?
Rebate in premium is a discount allowed by the insurer in festival seasons to boost business
Rebate is an allowed deduction in large sums assured and low frequency mode of payment
Rebate is illegal as it is a kind of bribery
All modes of payment are treated as equal for rebate purposes by the insurer
Q.27
Which is the correct statement?
Agent is primary underwriter as also field underwriter
Numerical method of underwriting is by far the most objective method
Risk in substandard lives is likely to be higher than standard lives on account of increased mortality risk
All of the above
Q.28
Which of the following is incorrect?
Profit is excess of income over outgo
Profits are excess of assets over liabilities
The same yardstick as is followed by a firm can be applied while life ins. valuation
All of the above
Q.29
Assets can be valued by –
Book value
Market value
Discounted present value
Either of the above
Q.30
Pick out the incorrect statement out of the following ones.
A policy document has to be signed by a competent authority authorised by the company, but it need not be stamped as per Indian Stamp act
Stamping the document is compulsory but it may be signed by anyone in the insurer’s office
Policy itself need not be issued by the insurer
All of the above
Q.31
Smart identity card for presenting it to network hospital in health insurance would be issued by–
Insurer
TPA
Either A or B
Neither A nor B
Q.32
In case of hospitalization in a network hospital, admission would be on the basis of –
Smart card
Pre-authorisation from Insurer/TPA
Either A or B
None of the three
Q.33
State which is a correct statement of the following.
Cashless facility means no cash need to be paid by anybody to the care provider
Cashless facility means a facility extended by an insurer to the insured where payments are made directly by the insurer to the network provider subject to preauthorisation
In cashless facility treatment is free for anyone seeking medical care
Cashless facility means that payments are split between the hospital and the insurer
Q.34
Which is correct?
Policy proceeds on surrender may be paid to the assured in an emergency
Only wife can be a trustee in such policy
If a trustee is not appointed the policy money can only be paid to the official trustee of the state
Only children can be beneficiaries of the policy
Q.35
In a keyman’s policy
The premium paid by the employer is treated as an allowable business expense
In a death claim the policy money is payable to the company
Death claim proceeds are treated as taxable income of the employer
All of the above
Q.36
Who provides public pensions?
Insurance company
NGO's who get Government money
State
Employees
Q.37
An annuity with infinite life with continuous payments of annuities by the insurer is
Amortised plan of loan
Annuity in perpetuity
APR
Principal
Q.38
When is a policy said to be withdrawn?
On surrender of the policy in return for surrender value
When the premiums are not paid as and when due
When a policy is upgraded
When a policy is downgraded
Q.39
State the correct statement
Market value of assets is always taken by the insurer
In periodical valuation of assets and liabilities book value of assets is normally taken by the insurer
Discounted present value of the assets is taken by the insurer
Discounted future value of the assets is taken by the insurer
Q.40
What is correct
Moral Hazard is about the intention and post purchase behaviour of an assured in most cases
Proposal is the basis of contract between a person seeking insurance cover and the insurer
Insurers should view very seriously the conduct of the persons for life insurance cover whenever they seek profit by purchase of insurance
All of the above
Q.41
The surplus in an insurance company is a function of –
How Asset is valued
How liability is valued
How Assets & Liabilities are valued
None of the above
Q.42
If Liabilities are liberally valued it would result in –
More surplus
Less surplus
More or less surplus
None of the above
Q.43
If Liabilities are undervalued it would result in –
More surplus
Less surplus
More or less surplus
Neither more nor less surplus
Q.44
For admission of domiciliary hospitalization claim, the minimum period of medical treatment should be –
24 hours
48 hours
3 days
4 days
Q.45
With regard to domiciliary hospitalization which is incorrect?
The limit for the same is fixed as a %age of total sum insured
All chronic diseases are covered without any exclusion
Both A & B
None of the above correct
Q.46
If the insured gets admitted in a non-network hospital,
He could still avail cashless facility
He would settle hospital bills and would get reimbursed by the insurer
Either A or B
Neither A nor B
Q.47
Who prescribes the format of a pre-authorisation letter and standard claim forms?
Central Government
Insurance company
TPA
IRDA
Q.48
As per IRDA regulations on health insurance –
Life time cover not mandated
Life time cover is mandatory
Either A or B
Neither A nor B
Q.49
Day care centre in health insurance parlance would mean –
Patients are admitted during day time only
There is no provision for round the clock treatment
Centre where procedures requiring less than 24 hrs hospitalization are done
None of the above
Q.50
Which among the following is not a Day Care procedure?
Byepass surgery
Cataract
Lithotripsy
Piles
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