IC39 Mock Test Sample 1
Fraud risk management in insurance focuses on identifying, preventing, and controlling fraudulent activities across various policies such as marine, motor, and miscellaneous insurance. Fraud can involve exaggerated claims, false declarations, or deliberate acts like scuttling or barratry. Regulatory bodies like IRDAI define fraud and mandate processes such as due diligence and timely reporting to FIU-IND. Intermediaries like agents and TPAs play key roles, while surveyors help validate claims. Insurance primarily provides financial security, with third-party motor insurance being mandatory. Effective fraud control requires ethical practices, open-minded investigation, and international cooperation through mechanisms like MLAT to combat financial crimes.
1. According to reports from the Insurance Fraud Bureau (IFB), fraudulent claims are generally increasing at what approximate rate per year?
a) 1%
b) 3%
c) 5%
d) 7%
2. What are the two types of damages for personal injury?
a) Compensatory damages and punitive damages
b) Special damages and general damages
c) Consequential damages and nominal damages
d) Liquidated damages and statutory damages
3. Which of the following insurance policies are included in construction phase insurance policies?
a) I, II, and III
b) II, III, and IV
c) I, IV, and V
d) I, II, and V
4. In the insurance industry, intermediaries like insurance brokers and agents play a role in:
a) Setting premium rates for insurance policies
b) Determining coverage limits
c) Procuring premium from policyholders
d) Providing medical services
5. Which of the following insurance policies are issued in miscellaneous insurance?
a) I, II, III, V, VI
b) I, II, IV, VI, VII
c) I, II, III, IV, V, VI
d) III, IV, V, VI, VII
6. Which organization provides the definition of fraud mentioned?
a) IRDAI
b) RBI
c) SEBI
d) CCI
7. Which of the following are considered frauds in marine insurance?
a) Claims for losses not occurred
b) Exaggeration of claim amount
c) Double insurance
d) All of the above
8. If theft of an animal is not covered, what might the insured do to seek compensation?
a) File accidental injury claim
b) Submit theft as uninsured event
c) Report to authorities
d) Declare the animal as dead and claim
9. What requirement must every insurance company fulfill under Rule 9?
a) Conduct background checks
b) Implement cybersecurity
c) Establish internal audit
d) Implement due diligence in all offices
10. What is the primary need of insurance?
a) Generate profits
b) Provide tax benefits
c) Ensure compliance
d) Provide financial security
11. As per Motor Vehicles Act 1988, which insurance is mandatory?
a) Comprehensive insurance
b) Collision coverage
c) Third-party liability insurance
d) Personal injury protection
12. Who controls exaggeration of claim amounts by cross-checking losses?
a) Insurance agents
b) Policyholders
c) Underwriters
d) Surveyors
13. Which are insurance intermediaries?
a) Insurance agents
b) TPAs
c) Insurance investigators
d) Only a & b
14. What is defined as wrongful act by master or crew against owner?
a) Perjury
b) Barratry
c) Embezzlement
d) Sabotage
15. What is the purpose of price skimming strategy?
a) Maximize profit from high-end customers
b) Offer discounts
c) Increase prices gradually
d) Capture demand curve in stages
16. In which country does ABI run the Insurance Fraud Bureau?
a) United Kingdom
b) USA
c) Canada
d) Australia
17. What approach should be adopted when visiting a location?
a) Predetermined conclusion
b) Avoid knowledge
c) Skeptical attitude
d) Open mind without prejudice
18. How does India facilitate international cooperation against money laundering?
a) Trade agreements
b) Cultural programs
c) Sports participation
d) MLAT
19. When should a statement be submitted to FIU-IND for suspicious activity?
a) Immediately
b) Within one working day
c) Within two working days
d) Within three working days
20. When do entities entice customers with “too good to be true” plans?
a) Tough economic conditions
b) Financial difficulties
c) Too low premiums
d) Both a and b
