IC01 Mock Test Sample 23
These IC01 Licentiate questions cover core insurance concepts including risk assessment, underwriting, and policy design parameters. Key areas include Probable Maximum Loss (PML) and Maximum Possible Loss (MPL), assignment vs nomination, and Unit Linked Insurance Policy features. They also test principles like indemnity, contribution, insurable interest, and utmost good faith. Regulatory aspects such as IRDAI powers, Section 45 of the Insurance Act, and RTI are included. Other topics involve premium classification, conditions precedent to liability, and complaints to Ombudsman. Additionally, questions address double insurance, claim distribution, and legal frameworks like Sale of Goods Act and Marine Insurance Act.
1. Which parameter is not relevant when designing a life insurance product?
- Mentality of specific customer
- The cost of benefit
- Type of benefit under the plan
- Age
- Physical health of the customer
2. Probable Maximum Loss or PML is determined using the Maximum Possible Loss (MPL) and which other factor?
- The cost of implementing loss reduction techniques
- The cost of consequential losses
- The probability of the peril striking
- The cost of the actual loss
- None of the above
3. Mr. Vijay has taken an Endowment Assurance Policy and he wants to transfer all the rights under this policy to his wife solely. What should Mr. Vijay do?
- Assignment
- Nomination
- Surrender
- Conversion
- Contract
4. In a Unit Linked Insurance Policy, what is NOT in the hands of the policy holder?
- Choice of funds
- Design of funds
- Sum assured
- Term
- Premium
5. What are the conditions Precedent to Liability?
- Requirements to disclose material facts, which are essential for the policy to be valid
- Requirements like notice being given of the happening of event within a stated period of time
- Requirements like giving notice of charges while the policy is in force
- All of the above
- None of the above
6. The premiums which are paid subsequent to the first premium are known as _____ .
- Repeat Premiums
- Future Premiums
- Renewal Premiums
- Revival Premiums
- Reinstatement Premiums
7. Which of the following statement is INCORRECT with respect to the powers of IRDAI to protect the interest of policy holders?
- IRDAI regulates the investment of fund
- IRDAI regulates the maintenance of solvency
- IRDAI defines the manner in which premium can be paid by a policy holder for purchasing an insurance policy
- IRDAI monitors contents of advertisement to ensure that they do not misguide
- IRDAI issues guidelines for assignment of transfer of policies and nominations
8. Which principle ensures that the insured cannot recover the losses from several insurance companies?
- Principle of Subrogation
- Principle of Contribution
- Principle of Indemnity
- Principle of Good Faith
- Principle of Insurable interest
9. A policyholder transfers their rights under a policy to another person. This process is called ________.
- Assignment
- Nomination
- Surrender
- Subrogation
- Deferment
10. What is the purpose of insurance?
- Bring people who are exposed to similar risks together
- Pay claims
- Collect premium
- All of the above
- Make profits for the insurance company
11. RTI means ____________.
- Right to infrastructure
- Right to information
- Right to immunity
- Right to intelligence
- Right to inside information
12. Which of these laws are different in different states of India?
- Inheritance laws
- Registration laws
- Mercantile laws
- Stamp duty laws
- All of the above
13. Mr. Soham has taken insurance of his house from two companies (PQR Rs. 50,000 and XYZ Rs. 1,00,000). Loss is Rs. 45,000. How much will he receive from each insurer respectively?
- Full Rs 45000 from PQR Insurance Co.
- Full Rs 45000 from XYZ Insurance Co.
- PQR Insurance Co. Rs 10000 and XYZ Insurance Co. Rs 35000
- PQR Insurance Co. Rs 15000 and XYZ Insurance Co. Rs 30000
- PQR Insurance Co. Rs 30000 and XYZ Insurance Co. Rs 15000
14. To which type of insurance does the principle of indemnity NOT apply?
- Life insurance
- Fire insurance
- Marine insurance
- Miscellaneous
- None of the above
15. Mr. Wilson had two life insurance policies (Rs 5 lacs and Rs 2 lacs). On death, how will the claim be paid?
- Rs 2 lacs from System Insurance Co. only
- Rs 3.5 lacs split proportionately between insurers
- Rs 5 lacs from New Life Insurance Co. only
- Rs 7 lacs total from both insurers fully
- As decided by Insurance Ombudsman
16. Which of the below options pose a challenge due to people's mindset towards insurance?
- Focus on present pleasures
- Tendency to leave everything to fate
- Priority to present needs over future needs
- Thinking of not dying soon
- All of the above
17. MPL and PML are used in ________ .
- Hedging
- Speculation
- Human Resource Management
- Risk Management
- Spread Management
18. The total of the actual loss and the consequential loss is known as the ________.
- Total loss
- Minimum Possible Loss
- Combined Loss
- Maximum Probable Loss
- None of the above
19. What agreement exists between the four public sector insurers to prevent unhealthy competition?
- Anti Competition agreement
- Universal agreement
- Non life agreement
- Market agreement
- General agreement
20. According to Section 45 of the Insurance Act, within how many years can a policy be declared void for non-disclosure of material facts?
- First six months of the policy
- First year of the policy
- First three years of the policy
- First five years of the policy
