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210+ Insurance Management Solved MCQs

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Commerce in Banking and Insurance (B.Com Banking and Insurance) .

1.

Insurance is a cooperative form of distributing a certain__________over a group of persons who are exposed to it.

A. Uncertainty
B. Risk
C. Peril
D. Hazards
Answer» B. Risk
2.

In legal sense, Insurance is a

A. Contract
B. Activity
C. Gambling
D. Publicity
Answer» A. Contract
3.

The principle of indemnity is not applicable to

A. Fire Insurance
B. Marine Insurance
C. Life Insurance
D. Property Insurance
Answer» C. Life Insurance
4.

LIC was nationalised in

A. 1956
B. 1955
C. 1957
D. 1948
Answer» A. 1956
5.

The policy for which the premium is payable throughout the life of the assured is known as

A. Annuity Policy
B. Whole Life Policy
C. Term Policy
D. Endowment
Answer» B. Whole Life Policy
6.

When the same risk and subject matter is insured with more than one insurer is known as

A. Reinsurance
B. Double Insurance
C. Under Insurance
D. Over Insurance
Answer» B. Double Insurance
7.

The chance of loss from the unforeseen circumstances in future refers to ______.

A. Perils
B. Damage
C. Risk
D. Hazards.
Answer» C. Risk
8.

Master policy is issued for ___________.

A. Group Insurance
B. Term Insurance
C. Marine Insurance
D. Individual Policy
Answer» A. Group Insurance
9.

The organisation structure of LIC refers to ___________.

A. Three Tier
B. Four Tier
C. Five Tier
D. Six Tier
Answer» B. Four Tier
10.

________ can be done by mere endorsement on the policy or by a separate duly stamped deed.

A. Assignment
B. Nomination
C. Renewal
D. Revival
Answer» A. Assignment
11.

The document which contains the terms and conditions of the life insurance contract is termed as the

A. Agreement
B. Life Insurance Policy
C. Cover Note
D. Proposal Form
Answer» B. Life Insurance Policy
12.

What is a proposal?

A. A request for an insurance cover
B. An offer to enter into a contract
C. Both a and b
D. None of the above
Answer» C. Both a and b
13.

Which of these persons will not be given a license to work as an insurance agent?

A. A person with criminal record
B. A corporate insurance executive.
C. An employee of an insurance company
D. All the three mentioned here.
Answer» A. A person with criminal record
14.

A memorandum added to a policy embodying some alterations to the terms of policy is known as

A. Surrender
B. Endorsement
C. Nomination
D. Breach of Contract
Answer» B. Endorsement
15.

Which of the following is an evidence of insurance contract?

A. Policy Document
B. payment of premium.
C. cover note
D. acceptance of proposal
Answer» A. Policy Document
16.

The person responsible for evaluation and acceptance / rejection of risks and computation of premium in insurance is called

A. Insured
B. Assurer
C. Agent
D. Underwriter
Answer» D. Underwriter
17.

Insurance prices are called

A. Commissions
B. Allowances
C. Premiums
D. Discounts
Answer» C. Premiums
18.

A person employed to do any act for another or to represent another in dealing with a third person refers to

A. Agent
B. Principal
C. Development Officer
D. Surveyor
Answer» A. Agent
19.

The IRDA was set up in

A. 1919
B. 1991
C. 2001
D. 2000
Answer» D. 2000
20.

______________ in the insurance are just like the retailers of any consumer product who help in selling and distributing the product.

A. Underwriters
B. Surveyors
C. Agents
D. Banker
Answer» C. Agents
21.

The agents who are selling policies of several life and non life insurance companies at a time are known as

A. Brokers
B. Surveyors
C. Underwriters
D. banks
Answer» A. Brokers
22.

_____________ are independent professionals appointed by an insurance company to assess the loss or damage on a claim under a policy.

A. Surveyors
B. Loss Assessors
C. Both a and b
D. Agents
Answer» C. Both a and b
23.

Insurance contract is sort of contract which is approved by

A. The Indian Contract Act
B. Indian Factory Act
C. Indian Companies Act
D. The Indian Finance Act
Answer» A. The Indian Contract Act
24.

General Insurance Corporation was established during the year

A. 1971
B. 1986
C. 1956
D. 1972
Answer» D. 1972
25.

The term Assurance refers to ________.

A. Marine Insurance Business
B. Life Insurance Business
C. Fire Insurance Business
D. Motor Vehicle Business
Answer» B. Life Insurance Business
26.

Committee of reforms in insurance sectors during 1993 headed by ________.

A. R.N. Malhotra
B. S. Narashiman
C. Manmohan Singh
D. P.Chidambaram
Answer» A. R.N. Malhotra
27.

Insurance business is based on __________.

A. Newtons Law
B. Boyles Law
C. The Theory of Probability and Law of large numbers
D. Parkinsons Law
Answer» C. The Theory of Probability and Law of large numbers
28.

Gross Premium means Net Premium plus___________

A. Margin
B. Profit
C. Expense Loading
D. Loss
Answer» C. Expense Loading
29.

_____________ is pricing of insurance products driven by market forces

A. De-tariffing
B. Fixed Pricing
C. Tariffing
D. Penetration Pricing____
Answer» A. De-tariffing
30.

____________ is the total premium that a policy holder pays to insurance company

A. Net Premium
B. Gross Premium
C. Partial Premium
D. Level Premium
Answer» B. Gross Premium
31.

Insurance helps to:

A. Prevent adverse situations from occurring
B. Reduce the financial consequences of adverse situations
C. Negate all consequences of adverse situations
D. Make assets continuously productive
Answer» B. Reduce the financial consequences of adverse situations
32.

An actuary is expected to:

A. Make an exact forecast of the future liabilities of policies
B. Make a reasonable forecast of the future liabilities of policies
C. Calculate the premium required to cover a risk on a long-term basis
D. Find the probability of an insured event to happen in non-life policies
Answer» B. Make a reasonable forecast of the future liabilities of policies
33.

The principle of _____________ ensures that an insured does not profit by insuring with multiple insurers

A. Subrogation
B. Contribution
C. Co-insurance
D. Indemnity
Answer» B. Contribution
34.

The principle of average applies when the value is _____________ in the proposal

A. Understated
B. Overstated
C. Not ascertainable
D. Negligible
Answer» A. Understated
35.

Fidelity Guarantee Policies cover losses due to fraud by ____________

A. Employees
B. Customers
C. Borrowers
D. Suppliers
Answer» A. Employees
36.

CTL as used in insurance

A. Contributory Total Loss
B. Constructive Total Loss
C. Construction Totally Lost
D. Contractors’ Total Loss
Answer» B. Constructive Total Loss
37.

GA as used in insurance

A. General Assurance
B. General Average
C. General Adjustment
D. Guaranteed Assurance
Answer» B. General Average
38.

Which of the following terms matches closest with ‘Family Floater’?

A. Health insurance
B. Property insurance
C. Accidental injury
D. Consequential loss
Answer» A. Health insurance
39.

In cases where a Life Insurance Agent collects the premium from the policyholder and remits it to the insurer’s office, he is acting as an agent of _____

A. IRDA
B. the Insurance Company
C. the Policyholder
D. the broker
Answer» B. the Insurance Company
40.

A policy where the policyholder makes a one-time payment of premium, is known as a ______________:

A. Money-back policy
B. Single premium policy
C. Salary Savings Scheme policy
D. Half-yearly policy
Answer» B. Single premium policy
41.

i. State which of the statements given below is correct .

A. An organisation can exist only with employees
B. An organisation can exist only with different sections
C. An organisation can exist only with its own office building
D. An organisation can exist without a purpose
Answer» A. An organisation can exist only with employees
42.

……… may be described as a social device to reduce or eliminate risk of loss to life and property.

A. investment
B. saving
C. insurance
D. loan
Answer» C. insurance
43.

State which of the statements given below is correct

A. People generally feel that life related risks are imminent
B. Religious beliefs interfere with the purchase of life insurance
C. People are always keen to buy insurance
D. Life insurance cannot be denied to anyone at any time
Answer» B. Religious beliefs interfere with the purchase of life insurance
44.

Compared to the premium for a Whole Life plan, the premium for an Endowment plan will be ____________ for the same age

A. more
B. less
C. the same
D. double
Answer» A. more
45.

Select the expanded form of SA as commonly used in life insurance

A. Sum Assured
B. Surrender of Assurance
C. Supplementary Assurance
D. Stamp Act
Answer» A. Sum Assured
46.

Select the expanded form of OR as commonly used in life insurance

A. Oral Rehydration
B. Once Renewed
C. Ordinary Rates
D. Ordinary Renewal
Answer» C. Ordinary Rates
47.

Select the expanded form of SV as commonly used in life insurance

A. Summary Valuation
B. Selected Value
C. Surrender Value
D. Stamp Value
Answer» C. Surrender Value
48.

Which of the following terms matches closest with ‘Automatic Teller Machines’?

A. Divisional Offices
B. Branch Offices
C. Agents
D. Information Kiosks
Answer» D. Information Kiosks
49.

Which of the following terms matches closest with ‘Foreclosure’?

A. Surrender Value
B. Nominee
C. Death Claim
D. Maturity Claims
Answer» A. Surrender Value
50.

Find out which of the given statements is incorrect

A. An organisation must have a purpose
B. An organisation is identified by its actions
C. An organisation is identified by the building it occupies
D. A organisation can sue and be sued
Answer» C. An organisation is identified by the building it occupies

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