Deck 5: Insurance Terminology and Policies

Question 1

Consideration on the part of the life insured in respect of a life insurance contract is _______

A)a promise to take a new policy
B)the insured promise to pay the premium under the policy
C)the payment made towards premium by the insured
D)proposal completed and signed by the person

Answer 1

the insured promise to pay the premium under the policy

Question 2

The policy holder's duty to disclose material facts lies at the time of ______

A)taking a policy
B)revival of policy
C)reinstatement of surrendered policy
D)all of the above

Answer 2

all of the above

Question 3

Master policy is issued for _______

A)Term insurance schemes
B)permanent insurance
C)individual insurance
D)group insurance schemes

Answer 3

group insurance schemes

Question 4

Who pays premium under social security group insurance scheme?

A)Every member of the group
B)Panchayat of the village
C)50% by a social security fund maintained by LIC of India
D)LIC of India

Question 5

Subrogation means ______

A)something of monetary value
B)to make good loss
C)payment of premium
D)transfer of rights of an insured to another person

Question 6

What is full form of FPA in the context of marine underwriting?

A)Foreign Policy Association
B)Free of Particular Average
C)Free Port Association
D)Food and Perishable Accounting

Question 7

Premium fixed by insurance company must be sufficient to _____

A)meet the claims
B)cover the expenses
C)both (a) and (b)
D)none of these

Question 8

Broker's Association of India was granted recognition by IRDA on _________.

A)Dec 11, 2001.
B)Dec 11, 2002.
C)Dec 11, 1999.
D)Dec 11, 2003.

Question 9

Foreign equity participation is allowed in insurance sector up to a limit of ____ percent.

A)80.
B)73.
C)49.
D)26 .

Question 10

Moral hazard may be suspected in cases where _____

A)the life to be insured is old.
B)the insurance is for a very large sum insured
C)in the both the cases
D)none of the above cases

Question 11

Which one of the following statements is correct?

A)The underwriter assesses the risk
B)No policy can be issued without underwriter decision
C)Both (a) an (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 12

Which one of the following statements is correct?

A)Underwriting is done only when there is a medical examination
B)Medical examination is necessary before a policy can be issued
C)Both (a) an (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 13

Which one of the following statements is correct?

A)Workingwomen are treated at par with men
B)Educated women are treated at par with men
C)Both (a) an (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 14

Financial underwriting is done to evaluate ____

A)the probability of the policy lapsing in future
B)the possibility of moral hazard
C)Both (a) an (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 15

The net premium will be ______

A)less than the risk premium
B)more than the risk premium
C)calculated by adding expenses to the risk premium
D)more than the pure premium

Question 16

When interest rates fall, the tabular premium rates are likely to _______

A)increase
B)decrease
C)remain the same
D)equal

Question 17

The reason for charging level premium is _______

A)risk increases as age increases
B)it is convenient to the policyholders
C)it is convenient to the insurer
D)all the above reasons

Question 18

What is meant by a claim under an insurance policy?

A)Any demand made by the policy holder on the insurer
B)A demand to fulfill the policyholders obligations
C)A demand to fulfill the insurer's obligations
D)All the three above

Question 19

Which one of the following statement is correct?

A)A death claim within two years of commencement is treated as an early claim
B)A death claim within two years of revival is treated as an early claim
C)Both (a) and (b) statements are correct
D)Both (a) an (b) statements are wrong

Question 20

Which one of the following statement is correct?

A)Maturity proceeds are paid to the nominee, if the policyholder dies earlier
B)Maturity proceeds are paid to the heirs, if the policy holders dies earlier
C)Both the above statements are correct
D)Both the above statements are wrong

Question 21

Which one of the following statement is correct?

A)No claim is paid unless the original policy is produced
B)Claim can be paid even without the original policy, if it is lost
C)Both the above statements are correct
D)Both the above statements are wrong

Question 22

Which one of the following statement is correct?

A)In the case of SSS policies, the grace period is one month
B)If the due date is 27th February the grace period ends on 26th March
C)Both (a) and (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 23

Which one of the following statement is correct?

A)If death occurs in grace period, the premium due is waived.
B)The date of payment of premium is the date on which the cheque is cleared
C)Both (a) and (b) statements are correct
D)Both (a) and (b) statements are wrong

Question 24

Which one of the following statement is correct?

A)When a policy lapses, the policy holders loses everything
B)When a policy lapses, some benefits are protected
C)Both statements are Correct
D)Both the statements are wrong

Question 25

Which one of the following statement is correct?

A)In group insurance, a single policy is issued covering many persons
B)A master policy covers servants of a master
C)Both the statements above are correct
D)Both statements above are wrong