IC01 (LICENTIATE) Principles of Insurance - 03
| Q1.Which of these statements is INCORRECT with respect to 'Material Facts'? |
| A fact is said to be material if it affects the decision of the underwriter to accept or reject the risk or to determine rates |
| A .fact' is material if it is relevant to the assessment of the risk and determination of the premium |
| Non-disclosure of material facts puts the insurer at a disadvantage |
| If in the first five years of the policy, the insurance company comes to know that some material fact has not been disclosed by the proposer, it can declare the policy as null and void. |
| If the insurance company comes to know about the wrong / withheld information, it can declare the contract void |
| Q2.When a person takes a Household Insurance Policy, the insurable interest exists at the outset and _____. |
| on the date, the policy is terminated |
| on the date, a claim arises |
| on the date, the policy document is received by the owner of the house |
| on the date, the cancellation period expires |
| on the proposal stage |
| Q3.Which of the following statements is INCORRECT with respect to 'Arbitration'? |
| It is a judicial process |
| The arbitrators need not be formal judges or lawyers |
| If there is only one arbitrator appointed, both parties must agree |
| Arbitrators are appointed by the parties to the dispute |
| Arbitration is a quick and less expensive way of resolving disputes |
| Q4.Which of these statements is INCORRECT with respect to NOVATION? |
| Novation can be done for both personal and non-personal contracts |
| Novation can be done only with the consent of the insurance company |
| After Novation, the transferred contract is virtually a new one |
| In Novation, the insurance company implicitly expresses confidence in the policyholder's integrity |
| Novation is a process of transferring an insurance contract by way of assignment |
| Q5.Which ratio reflects the overall underwriting profitability of a company? |
| PE ratio |
| Surrender ratio |
| Combined ratio |
| Loss ratio |
| Surrender ratio |
| Q6.Aviation insurance falls under which category of insurance? |
| Miscellaneous Insurance |
| Engineering Insurance |
| Marine Insurance |
| Motor Insurance |
| Fire Insurance |
| Q7.To make an insurance business successful, the key parameter(s) is/are ___. |
| Customer service |
| Customer centricity |
| Ease of access |
| Innovative products |
| All of above |
| Q8.Which of these statements is incorrect? |
| Tax benefits will be the same for all insurance policies every year |
| Commuted values of pensions are exempt from income tax |
| In general insurance plans, the tax benefit is available only on health insurance plans |
| Life insurance policies provide a saving of taxes |
| The claim amount received under a life insurance policy is exempted from Income tax subject to certain conditions |
| Q9.Dhawal wants to become an insurance broker. He attended the required training for this. However, he missed out on a few days of training as he was not well. Now he is well. What is the next step for Dhawal? |
| Dhawal can start meeting clients and suggest them suitable plans |
| Dhawal cannot solicit insurance business as he has not completed his training |
| Dhawal has to obtain a license after passing the prescribed exam |
| Only options 2 and 3 |
| None of the above |
| Q10.In the case of personal accident policies, there is no need for assessment of risk, except on the factor of _____. |
| occupation |
| illness |
| age |
| lifestyle |
| All of the above |