Top 80+ Solved Principles of Insurance MCQ Questions Answer
Q. The company doing insurance business is called:
a. mutual funds
b. non-banking firm
c. banking company
d. an insurance company
Q. All of the following are disadvantages of using insurance EXCEPT
a. There is an opportunity cost because premiums must be paid in advance.
b. Considerable time and effort must be spent selecting and negotiating coverages.
c. It results in considerable fluctuations in earnings after a loss occurs.
d. Attitudes toward loss control may become lax.
Q. All of the following can be classified as casualty insurance EXCEPT
a. Marine insurance.
b. General liability insurance.
c. Workers compensation insurance.
d. Burglary and theft insurance.
Q. Insurance eliminates or decreases the uncertainty associated with occurrence of an event
a. Correct
b. Wrong
c. Partially correct C.
d. Totally misleading
Q. The insurance plays a role in the economic development of the country in following ways:
a. Release capital for new investments.
b. The job potential increases
c. Money collected is invested in infrastructure
d. All of the above
Q. Insurance brokers are governed by
a. Sale of Goods Act
b. Agency Law
c. IRDA Act. 1999
d. Mercantile Law
Q. A reinsurance of insurance refers to ________.
a. line.
b. retention.
c. retrocession.
d. cession.
Q. IRDA Act. 1999 defines insurance intermediary as one including also
a. Insurance broker
b. UTI Agent
c. Sarpanch
d. Medical Examiner
Q. Insurance reduces the extent of financial loss connected with uncertain events
a. True
b. False
c. To the extent of insurance cover
d. Does not reduce the loss at all
Q. The business of insurance is related to protection of
a. Savings
b. Status
c. Profits
d. Economic value of assets
Q. Which of the following is the similarity between insurance and gambling?
a. The amount of loss to be paid is known beforehand
b. Promise to pay on the happening of an event
c. Both the parties win on happening of an event
d. Both are enforceable at law
Q. What is underwriting in Insurance ?
a. Process of investing the premiums which insurance provider collect from insured parties.
b. A claim arises on the occurrence of a specified event
c. Process by which insurers select the risks to insure and decide how much in premiums to charge for
d. The ratio of losses and expenses to premium
Q. Insurance Sector in India is regulated by IRDA. What is full name of IRDA?
a. Insurance Regulating and Development Agency
b. Insurance Rules and Development Authority
c. Insurance Rules and Deployment Authority
d. Insurance Regulatory and Development Authority
Q. Which of the following is the main objective of IRDA:
a. To take care of the policy holder interest
b. To open the insurance sector for private sectors
c. To supervise the activities of intermediaries
d. All of above