Winning Edge - IC-38 Questions payment to be made to payee by Insurance

company:-
1. Characteristics of endowment plan and term plan. a) Interest at the rate applicable to a saving
Ans: Endowment plan have cash value, but term bank account.
plan does not b) Additional 2% Interest at the rate applicable
2. Convertibility of available financial resources into to a saving bank account.
usable cash with ease is term as ….. c) Additional 4% Interest at the rate applicable
a) Investment b) Liquidity to a saving bank account.
c) Bankrupt d) Saving d) No extra interest will be payable to nomiee.
3. Sheetal is software engineer, 32 years old, her
anticipated mortality is significantly lower than 11. ______________, by mutual agreement of the
standard lives, Sheetal will be classified insured and the insurer can act as a mediator and
under_________ counsellor within the terms of reference.
a) Standard Lives b) Preferred risks a) Ombudsman b) Consumer Protection Act
c) Substandard Lives d) Declined Lives C) IGMS d) Customer Grievances Redressal
4. Factors affect health except 12. In Employees; state Insurance Scheme employee
a) Environmental b) Age contributes ________
C) Occupation d) Sanitation a) 0.0175 b) 0.0475 c) 0.125
5. Which element of valid contract, not allowed d) 0.075
minor to enter into insurance contract.
a) Consideration b) Coercion 13. All the statements are true regarding Employees’
c) Capacity to pay d) Undue influence state Insurance Scheme excepts_____
a. This scheme was introduced for blue –
6. Premium refers to _________element of a valid collar workers employed in the formal
contract. private sector.
a) Consideration b) Coercion b. All workers earning wages upto Rs 15000
C) Capacity to pay d) offer & Acceptance are covered under the contributory
scheme.
c. State govt contributes 12.5% of the
7. Specific provision refers to__________________ medical expenses.
Ans. A clause precluding death due to d. Employee contribution is 7.5%.
pregnancy for a lady who is expecting at
the time of writing the contract. 14. The Sum assured under the keyman insurance
policy is generally linked to which of the
8. Which of the below forms the first part of a following?
standard insurance policy document? a. Offset business startup
a. Policy Schedule b)Standard Provisions b. Offset business continuity
c)Specific Policy Provisions c. offset business loss recovery
d)Claim procedure
9. Suresh is contributing in 20% sales of company. 15. Which cannot be categorised under risks?
He is unable to continue his work after his a)Dying too young b) Dying too early
disability, which policy will help company to c)Natural wear and tear
compensate the loss d) Living with disability
a) HUF b) Key man Insurance
c)MWPA d) Business Insurance 16. Uncertainty refers to___________
a. Risk
10. If claim is ready for payment, but payment can b. Profit
not be made due to any reason of a proper c. Investment
identification of the payee, then What will be the d. Saving amount
17. Who will bear mortality risk in ULIP Plan? 25. below statements are true except
a) Insurer b) Insured a. When a factory gets destroyed by fire, the
c) Both Insured and insurer d) none of them actual value of goods damaged or
destroyed can be estimated and the
18. Why accumulation of cash value is not guaranteed compensation can be paid to the one who
is variable Insurance Plan? suffers such loss.
a) Money are invested in stock. b. If an Individual undergoes a heart surgery,
b) Company has to bear loss, if they will offer the medical cost of the same is known
guaranteed return. and compensated.
c) This is a traditional product. c) A fire may interrupt business operations and
d) IRDA has instructed insurance company to do lead to loss of profits which also can be
this. estimated and the compensation can be paid to
19. Which of the below option is true with regards to the one who suffers such a loss.
MWP act cases?
Statement I: Death Claims are settled in
favour of nominees. 26. Who regulates Banks?
Statement II: Death claims are settled in favour of a) Reserve bank of India
trustees. b) Govt of India
a) I is true. b) II is true c) SEBI
c)Both I and II are true d)Neither I nor II is true. d) State Bank of India

20. In case of_____________, a company expresses 27. Which following scenario refers to fraud?
the bonus as a percentage of basics benefit and a. Ramesh threatens to kill Mahesh if he
already attached bonuses. does not sign the contract
a)Reversionary Bonus b)Compound Bonus b. Undue influence
c) Terminal Bonus d) Persistency Bonus c. giving wrong information
d. could not understand fine printing
21. Who devised the concept of HLV? 28. Which of not following health insurance product
a)Dr Martin Luther King b)Warren Buffet provide fixed benefits?
c)Prof. Hubener d)George Soros a)Critical Illness covers b)Hospital Cash
c)Indemnity Covers d) Mediclaim
22. What HLV indicates:-
Ans. Multiplier of annual income if sole bread 29. Self-Insurance also known as
earner is not their. a)Risk Retention b)Risk avoidance
c)Risk Reduction d)Risk transfer
23. Out of 400 houses, each valued at Rs 20,000, on
an average 4 houses get burnt every year 30. following are the features of Jan arogya Plan
resulting in a combined loss of Rs. 80,000. What excepts
should be the annual contribution of each house a. The policy is designed to provide cheap
owner to make good this loss? medical insurance to poorer section.
a) Rs 100/- b)Rs 200/- b. The policy is available to Individuals and
c) Rs 80/- d) Rs 400/- family members.
c. The sum insured is per insured person is
24. Who is Insurance Regulator? restricted to Rs. 5000.
a. Insurance Authority of India d. Cumulative bonus and medical check-up
b. Insurance Regulatory And Development benefits are included.
Authority 31. Mr Suresh has taken a policy for 20 years and gets
c. Life Insurance Corporation of India. the maturity after 20 years, under which plan he
d. General Insurance corporation of India applied for?
a. Whole life plan
 b. term Plan 38. Which among the following is the regulator for
c. Endowment Plan the insurance industry in India?
d. ULIP plan a. Insurance Authority of India
32. Which of the below mentioned insurance plans b. Insurance Regulatory and Development
has the least or no amount of saving element? Authority of India
a. Term Insurance Plan c. Life Insurance Corporation of India
b. Endowment Plan d. General Insurance Corporation of India
c. Whole life plan 39. ___________ has jurisdiction to entertain
d. Money back plan matters where value of goods or services and the
33. If Suresh mortgages a assets and wants to take a compensation claim is up to 20 laths
plan to protect his loan, which plan would be a. High Court
most likely as per his requirement? b. District Forum
a. Term Plan c. State Commission
b. Mortgage Redemption Plan d. National Commission
c. Whole Life
d. Endowment Plan 40. Which element of a valid contract states that a
34. Which of the below forms the first part of a minor can’t take insurance?
standard insurance policy document? a. Offer and acceptance
a. Policy schedule b. Consideration
b. Standard Provisions c. Free consent
c. Specific Policy Provisions d. Capacity of parties to contract
d. Claim Procedures 41. _____________ relates to inaccurate statements,
35. Mahesh has bought a life insurance policy with a which are made without any fraudulent intention.
critical illness rider. He has made absolute a. Misrepresentation
assignment of the policy in favour of Karan. b. Contribution
Mahesh suffers a heart attack and there is a claim c. Offer
of Rs 50,000 under the critical Illness rider. To d. Representation
whom will the payment be made in this case.
a. Mahesh 42. ________________ involves pressure applied
b. Karan through criminal means.
c. The payment will be shared equally by a. Fraud
Mahesh and Karan. b. Undue influence
d. Neither of the two because Mahesh has c. Coercion
suffered the heart Attack but the policy is d. Mistake
assigned in the favour of Karan. 43. A policy of insurance may be called in question at
36. ______________independent entity for health any time within ____ years from the date of
claim process. issuance of the policy or the date of
a. TPA commencement of risk or the date of revival, of
b. Preferred Provider Network the policy or the date of the rider to the policy,
c. Hospitals whichever is later, on the ground of fraud.
d. Insurance company
37. An applicant who is aggrieved by the decision of a. Two
the Designated Official refusing to grant the b. Three
agency appointment may submit a review c. Four
application to _______________for review of the d. Five
decision. 44. The Claim which is paid at the end of policy term
a. Appellate Officer is called as :
b. Examination body a. Surrender Value
c. Mono-Line Insurer b. Rider Benefit
d. Designated Official c. Maturity
 d. Paid in Cash Bonus c. Increasing Term Insurance
45. Trauma Care Cover is known as : d. Decreasing Term Insurance
Ans : Critical Illness Cover/ Dreaded 52. Money laundering is the process of bringing
disease cover) _______ money into an economy by hiding its
46. Which of the below can be attributed to moral _______ origin so that it appears to be legally
hazard? acquired.
a. Increased risky behaviour following the a. Illegal, illegal
purchase of insurance b. Legal, legal
b. Increased risky behaviour prior to the c. Illegal, legal
purchase of insurance d. Legal, illegal
c. Decreased risky behaviour following the 53. Which underwriting method is considered to be
purchase of insurance speedy method?
d. Engaging in criminal acts post being a) Medical Underwriting
insured b) Non- Medical Underwriting
c) Numerical Underwriting
d) Judgemental Underwriting
47. During which stage of life will an individual 54. If a person wants to invest his major portion of
appreciate past savings the most? the money in Government bonds, Corporate
a. Post retirement Bonds and Fixed Deposits, which fund he should
b. Earner choose :
c. Learner a. Equity Fund
d. Just married b. Debt Fund
c. Balanced Fund
48. Vikram has applied for an insurance policy. His d. Money Market Fund
anticipated mortality is higher than normal. Under 55. Santosh has applied for a term insurance policy.
risk classification, he will be classified His anticipated mortality is significantly lower
under___________. than standard lives and hence could be charged a
a. Standard lives lower premium. Under risk classification, Santosh
b. Preferred risks will be classified under ___________.
c. Substandard lives a. Standard lives
d. Declined lives b. Preferred life
c. Substandard lives
49. . What is a policy withdrawal? d. Declined lives
a. Discontinuation of premium payment by 56. Which of the below statements are correct about
policyholder healthcare infrastructure EXCEPT :
b. Surrender of policy in return for acquired a. Health status of person varies from
surrender value person to person.
c. Policy upgrade b. It is feasible to make the infrastructure
d. Policy downgrade available at same level for all types of
50. Life insurance companies may offer rebate to the health problems.
buyer on the premium that is payable on the basis c. It is neither feasible nor necessary to
of ___________. make the infrastructure available at same
a. Sum assured chosen by the buyer level for all types of health problems.
b. Type of policy chosen by the buyer d. The healthcare facilities should be based
c. Term of the plan chosen by the buyer upon the probability of the incidence of
d. Mode of payment (cash, cheque, card) disease for the population.
chosen by the buyer
51. Variable Life Insurance is also known as :
a. Whole Life
b. Term Insurance
57. One of the methods of reducing insurance cost of 66. How would you refer to the individual life stage
an insured is __________ as per Age / financial needs / Family Situation ?
a. Reinsurance a. Financial Planning
b. Deductible b. Tax Planning
c. Co-insurance c. Retirement Planning
d. Rebate d. Cash Planning
58. Under State Insurance Scheme, an employee
contributes what percentage of his pay roll? 67. Example of Intangible /
a. 4.75 % a. House
b. 12.5 % b. Insurance
c. 1.75 % c. Mobile Phone
d. 0.75 % d. Car
68. Refusal of appointment letter of agent will be
59. Which of the below agency (ies) have power of communicated in How many Days?
civil court ? a. 15 days
a. District Forum b. 7 days
b. State Commission c. 21 days
c. National Comission d. 30 days
d. All of the above 69. Ramesh has insurance policies and he is in dier
60. Which is the most important document required need of Money , Suggest him?
to process a health insurance claim ? a. Purchase a new policy
(Ans : Discharge Summary) b. Stop paying the premiums
61. Which of the below are more exposed to c. Surrender the High Cash Value Policies
“accidental hazards”? 70. Which among the following the example of
a. Rickshaw Puller Coercion?
b. Circus Artist a. Ramesh signs a contract without having
c. Superstar Entertainer knowledge of the fine print
d. Bodyguard of a Businessman b. Ramesh threatens to kill Mahesh if he
62. What does MRI stands for ? does not sign the contract
a) Medical Reimbursement Index c. Ramesh uses his professional standing to
b) Mortgage Redemption Insurance get Mahesh to sign a contract
c) Magnetic Resonance Imaging d. Ramesh provides false information to get
63. _______________ is not an indicator of service Mahesh to sign a contract.
quality. 71. Ramesh wants to purchase the Life insurance
a. Cleverness policy which material facts are important?
b. Reliability a. Going on Family Vacation
c. Empathy b. Suffering from Critical Illness.
d. Responsiveness 72. What is the objective behind MRI ?
64. What are the Component of Level Premium? a. Facilitate cheaper mortgage rates
a. Protection + Cash Value b. Provide financial protection for home
b. Protection + Regulatory Component loan borrowers
c. Regulatory Component + cash Value c. Protect value of the mortgaged property
d. Regulatory Component + Subsidy d. Evade eviction in case of default
65. Select the operation with regard to MWP Policy ? 73. The sum assured under key man insurance policy
i) Policy can be surrendered by assured ii) is generally linked to which of the following?
Assured can Nomination & Assignment a. Key man income
a. i) is correct b. Business profitability
b. ii) is Correct c. Business history
c. i) & ii) correct d. Inflation index
d. i) & ii) are incorrect
74. Under what circumstances would the policyholder 81. Agent who hold license for Life insurance ,
need to appoint an appointee? General Insurance & Health Insurance ?
a. Insured is minor a. Agent
b. Nominee is a minor b. Composite Agent
c. Policyholder is not of sound mind c. Corporate Agent
d. Policyholder is not married d. Broker
75. Many Proposal form are underwritten & accepted 82. ________ means any fault in quality, nature &
for insurance without Conducting Medical masses of performance which is required to be
Examination? maintained by person in pursuance of Contract?
a. Medical underwriting a. Deficiency
b. Non Medical Unwitting b. Imperfection
c. Numerical underwriting c. Shortcoming
d. Judgmental underwriting d. Defect
76. Shikha Gupta is 35ys old & working as Software 83. Morbidity premium will be higher for
Engineer who has classified under Preferred Risk a) infant bi) Adult age >45
by insurer. Insurer will charge? c) Child more than 10 years
a. High Premium d) Adult age <45
b. Standard Premium
c. Low premium 85. Kapil 32 yrs wishes to take Health cover without
d. Tabular Premium going for long process, Medical, Waiting period &
77. When was CGHS introduced processing delay?
a. 1956 a. Group insurance
b. 1954 b. Non Medical Underwriting
c. 1972 c. Numerical Rating Method
d. 2001 d. Medical underwriting
78. Mr Poddar insulated wiring in his house to protect
from fire. Classify this under the risk 86. Which of the following is correct in regards to
management? Underwriter?
a. Risk Avoidance a. Underwriter determine premium
b. Risk Transfer b. Employee of Insurer
c. Risk Retention c. Validate Clause of Policy
d. Risk Reduction d. All of the above
79. which of the below statement is correct with 87. Identify the statement Mutuality & diversification.
regards to Grace period of Health Insurance? i) Diversification funds flowing one source to
a. The standard length of the grace period is many destinations. ii) Mutuality funds flow from
one month many sources to one.
b. The standard length of the grace period is a. i) is true ii) false
30 days b. i) & ii) are true
c. The standard length of the grace period is c. i) is false ii) is true
one month or 30 days d. I & ii are false
d. The standard length of the grace period 88. Document needed at the time of claim.
is one month or 31 days Ans. Policy document
80. As per the IRDA Regulations, An Investigation
claim under Life insurance policy will be paid 89. In which of the factor like age, sex, race,
within ? occupation, residence, environment, build, habits,
a. 1 Month family & personal history are examined ?
b. 6 Months a. Numerical Rating Method
c. 2 Months b. Medical Underwriting
d. 4 Months c. Group Insurance
d. Non medical underwriting
90. According to Hippocrates (460-370 BC) illness 97. With regard to Renewal which statement is true?
caused by ? I) It is Legal Obligation on the Insurer Part. Ii) As a
a. Sanitation matter of Courtesy & healthy Business Practice
b. Personal Hygiene iii)Issue Notice in advance of the date of expiry?
c. Diet a. I is correct
d. All of the Above b. Ii is correct
91. Policy available to Groups of 100 or more c. Iii is correct
families? d. Ii & iii are correct
a. Universal Health Insurance Scheme 98. Which of the below consumer grievance
b. Rshtriya Swasthya Bima Yojana redressed agencies would handle consumer
c. Jan Arogya Bima Policy disputes amounting between Rs. 20 lakhs and Rs.
d. Pradhan Mantri Suraksha Bima 100 lakhs?
92. Which among the following cannot form the basis a. District Forum
for a valid consumer complaint? b. State Commission
a. Shopkeeper charging a price above the c. National Commission
MRP for a product d. Zilla Parishad
b. Shopkeeper not advising the customer 99. Who has jurisdiction over State Forum
on the best product in a category a. Ombudsman
c. Allergy warning not provided on a drug b. District Forum
bottle c. National commission
d. Faulty products d. State Commission
93. Who among the following is most likely to buy 100. Consumer forum is regulated by which act
variable life insurance? a. Consumer protection Act 12/1/1987
a. People seeking fixed return b. Consumer protection Act 12/2/1982
b. People who are risk averse and do not c. Consumer protection Act 10/4/1986
dabble in equity d. Consumer protection Act 21/11/1984
c. Knowledgeable people comfortable with 101. _____________ relates to error in one’s
equity knowledge or belief or interpretation of a thing or
d. Young people in general event
94. Which among the following is correct in regard of a. Mistake
Terminal Bonus? b. Contribution
a. Longer the Period Lesser the Bonus c. Coercion
b. Longer the Period Higher the Bonus d. Undue Influence
c. Shorter the Period Higher the Bonus 102. Name the plan 1) Which gives money on
d. Shorter the Period lower the Bonus Maturity 2) Which gives death benefit
95. Sec 45 of Insurance protect the insured from the a. Term Plan
claim with in how much time? b. Endowment
a. 2 yrs c. Increasing term Plan
b. 3 yrs d. Pure Endowment
c. 5 yrs 103. What is full form of ULIP
d. 1 yr a. Unit linked Investment Plan
b. Unit Linked Investment Product
96. Health hazard? c. Unit Linked Insurance Plan
a. Rickshaw Puller d. Unit linked Insurance Product
b. Bouncer
c. Scaffolding Working
d. Circus acrobat
104. Santosh has applied for a term insurance a. Sec 41
policy. His anticipated mortality is significantly b. Sec 42
higher than standard lives and hence could be c. Sec 45
charged a higher premium. Under risk d. Sec 47
classification, Santosh will be classified under 111. Can Life Assured under MWPA policy
___________. i)surrender the policy ii) Assign the policy
a. Standard lives a) Statement (i) is true.
b. Preferred risks b) Statement (ii) is true.
c. Substandard lives c) Both the statement is true.
d. Declined lives d) Both the statement is wrong.
105. If complex language is used to word a 112. Postponement of consumption and
certain policy document and it has given rise to an parting with liquidity is triggered by
ambiguity, how will it generally be construed? a. investment
a. In favour of insured b. Insurance
b. In favour of insurer c. Shares
c. I The policy will be declared as void and d. Saving
the insurer will be asked to return the 113. Which statement is correct.
premium with interest to the insured 1) Assignment can be done after buying the policy
d. The policy will be declared as void and the 2) The life insured can nominate one or more than
insurer will be asked to return the one person as nominees.
premium to the insured without any a. Both statements are wrong
interest b. Statement 1 is correct & Statement 2 is
106. Mahesh ran a business on borrowed wrong
capital. After his sudden demise, all the creditors c. Statement 2 is wrong & Statement 1 is
are doing their best to go after Mahesh’s assets. correct
Which of the below assets is beyond the reach of d. Both statement are right
the creditors? 114. Who provides license to agents
a. Property under Mahesh’s name a. SEBI
b. Mahesh’s bank accounts b. RBI
c. Term life insurance policy purchased c. IRDA
under Section 6 of MWP Act d. Central govt.
d. Mutual funds owned by Mahesh 115. The process of evaluating each proposal
107. Which of the below is not a component of in terms of degree of the risk it represents and
ULIP premiums? accordingly deciding whether to grant insurance
and on what terms is called:
a. Policy allocation charge
a. Classification of risk
b. Investment risk premium b. Categorization of risk
c. Mortality charge c. Selection of risk
d. Social security charge d. Rejection of risk
108. Mr. Rajan earns Rs1.20 Lac a year and 116. Morbidity premium for which group
spends Rs.24 k on himself. Suppose the rate of would be high 1) Kid 2) Adult 3) Old
interest is 8%. Calculate HLV a. 1 & 3 b)2 & 3 c)1&2
a. 1200000
117. Praveen died in a car accident. The
b. 2000000 beneficiary submits documents for death claim.
c. 800000 Which of the below document is an additional
d. 100000 document required to be submitted in case of
109. Who is eligible for Key man insurance accidental death as compared to natural death.
a. A worker working in the factory
b. A person contributing 25% sales to the a. Certificate of burial or cremation
b. Treating physician’s certificate
organization
c. Employer’s certificate
110. Rebate comes under which section d. Inquest Report
 b) (ii) Statement is right.
118. A person qualifying for Insurance without c) (i) & (ii) is right.
medical would be classified under d) (i) & (ii) is wrong.

a. Medical Underwriting 128. What do you understand by NAV in ULIP?

b. Financial Underwriting a) Net Assets Value
c. Non- Medical Underwriting
b) New Assured Valuation
d. Numerical Underwriting
c) Net Accumulation Value
119. A person who has lost his policy d) Net Assets Validation
document will follow the following process
a. Will make new document & hand over to
the insurer
b. Will Inform the Insurer verbally
c. Will give written intimation to the
Insurer along with proof of loss

120. Example of Mass Policies – RSBY

121. When Claim is payable to nominee?

a) Death claim b) Maturity claim
c) Survival claim d) Critical Illness claim

122. Which of the below party is not eligible

to enter into a life insurance contract?
a)Business owner b) Minor
c) House wife d) Government employee
123. MRI refers________________ protection
for home loan borrower?
a) Social b) Financial
c) Economic d) Risk

124. Mr Ramesh wants to take loan on his

existing policy. For that what are the documents required
to present to the insurer?
a) Policy Document b) KYC
c) Proposal Form d)Nomination proof

125. Who regulates TPA for claim processing?

a) LIC b) Govt of India
c) IRDAI d) SEBI

126.Negative surplus refer to______________.

a) Loading b) Inertia
c) Rebate d) Penalty

127. Which statement is correct in reference of

Co- Insurance?
i) In co-insurance, expenses are borne by both
the Insurance Co.
ii) When the percentage of contribution is
decided by both the insurer at the time of
claim.
a) (i) Statement is right.