IC01 Mock Test Sample11
These questions cover key concepts of insurance regulation, policies, and principles in India. IRDAI regulates intermediaries, while FEMA governs NRI insurance transactions. Institute Cargo Clauses, drafted by London underwriters, are globally accepted for marine insurance. Reinsurance types like facultative allow risk selection by reinsurers. Various policies such as fire, burglary, and household goods have specific coverage features. Concepts like novation, annuities, and loss of profits insurance are also tested. The questions also assess knowledge of IRDA establishment, agent licensing, and FDI limits. Overall, they focus on practical and regulatory aspects important for insurance exams like LIC, III, and NISM.
1. Who regulates the remuneration paid to agents, brokers & other intermediaries?
A. Securities and Exchange Board of India (SEBI)
B. Insurance Regulatory and Development Authority of India (IRDAI)
C. Reserve Bank of India (RBI)
D. Pension Fund Regulatory and Development Authority (PFRDA)
E. Ministry of Finance
2. ______ drafts the Institute of Cargo Clauses.
A. New York underwriters
B. London underwriters
C. Tokyo underwriters
D. Marine underwriters
E. India underwriters
3. The term used when the reinsurer has the right to decide whether to accept the risk is:
A. Facultative reinsurance
B. Surplus reinsurance
C. Pool arrangement
D. Covering limit
E. Excess of loss
4. As per current rules, how much FDI is allowed in the Insurance Industry?
A. 26%
B. 35%
C. 74%
D. 51%
5. Mr. Kamal is a NRI. He will be subject to:
A. Contract Act
B. FERA Act
C. The Negotiable Instruments Act
D. Transfer of Property Act
E. Foreign Exchange Management Act
6. NRI insurance transactions are governed by:
A. The Limitation Act
B. Foreign Exchange Management Act
C. Inheritance laws
D. Transfer of Property Act
E. The Negotiable Instruments Act
7. Fidelity guarantee policies cover losses due to fraud by:
A. Employee
B. Customers
C. Borrowers
D. Suppliers
8. Which of these statements is INCORRECT?
A. A life insurance policy can be for several years
B. A non-life policy can be for short duration
C. Non-life policies cannot be issued for periods longer than 1 year
D. Fire and motor policies are generally valid for a year
E. Marine policies are effective during shipment
9. Loss of Profits insurance falls under:
A. Personal insurance
B. Miscellaneous insurance
C. Marine cargo insurance
D. Fire insurance
E. Life insurance
10. Which option best describes Fire Insurance?
A. Covers all accidents
B. Covers medical expenses abroad
C. Covers third-party liability
D. Covers loss of profits
E. Covers damage due to fire & explosion
11. Which statement is INCORRECT with respect to NOVATION?
A. Applies to both personal & non-personal contracts
B. Requires consent of insurer
C. Becomes a new contract
D. Shows insurer confidence
E. Transfer by assignment
12. Which statement is INCORRECT with respect to NOVATION?
A. Requires consent of insurer
B. Shows insurer confidence
C. Transfer by assignment
D. Becomes new contract
E. Applies to both types
13. Burglary insurance is a:
A. Full value
B. First loss
C. Floater
D. Valued
E. None
14. IRDA was set up in the year:
A. 2005
B. 2004
C. 2002
D. 2000
E. 1999
15. In case of individual agents, license validity is:
A. 2 years
B. 3 years
C. 5 years
D. 10 years
E. Lifetime
16. Institute Cargo Clause is used because:
A. Internationally accepted
B. Clarifies coverage
C. Compulsory
D. Both 1 and 2
E. None
17. Which clause is used when goods move internationally?
A. Berlin Cargo Clause
B. Institute Time Clause
C. Institute Cargo Clause
D. UK Cargo Clause
E. International Cargo Clause
18. Which of the following options is incorrect?
A. Annuities can be paid only through annual installments
B. Deferred annuity can be lump sum/installments
C. Annuities mitigate longevity risk
D. Deferred annuity starts later
E. Immediate annuity starts soon
19. Household goods policy is a:
A. Valued
B. First loss
C. Full value
D. Floater
E. None
20. Which option is not similar to others?
A. Gain
B. Loss
C. Probability
D. Damage
E. Uncertain
