IC39 Mock Test Sample 17
Insurance fraud prevention relies on strong systems, monitoring, and collaboration. Insurers reduce risks by maintaining qualified medical panels, conducting risk inspections, and analyzing claims patterns. Fraud—both soft (opportunistic exaggeration) and hard (planned deception)—negatively impacts governance, especially when linked with black money, which weakens public policy implementation. Suspicious triggers include sudden increases in sum insured or misrepresentation of fire causes. Investigations depend on observations, interactions, and evidence gathering. Policies like comprehensive motor insurance and indemnity health plans support coverage, while limits such as AAL/APL define liability. Regulatory bodies like IAIS and NAIC promote anti-fraud standards, transparency, and accountability across the insurance sector.
1. How can insurance companies mitigate fraud risks?
a) Offering higher compensation to policyholders
b) Increasing premiums for medical coverage
c) Collaborating with medical professionals for fraud prevention
d) Ensuring the availability of a qualified medical team on the insurer's panel and monitoring them effectively
2. What impact does black money have on governance and public policy?
a) Positive influence on policy decisions
b) Limited impact on policy effectiveness
c) No effect on governance and public policy
d) Detrimental effect on governance and conduct of public policy
3. Fire incidents shown as electrical short circuit may be due to:
a) Intentional fire for pecuniary benefit
b) Unclear cause of loss
c) Both a & b
d) Misinterpretation of fire reports
4. What is soft fraud in insurance?
a) Exaggerating the quantum of loss in opportunistic fraud
b) Intentionally causing minor accidents
c) Falsely reporting stolen items
d) Fabricating medical conditions
5. A package policy in motor insurance is also known as:
a) Third-Party Policy
b) Comprehensive Policy
c) Liability-Only Policy
d) Standalone Own Damage Policy
6. Supplying inferior stock but claiming superior stock is:
a) Stock market manipulation
b) Insider trading
c) Fraudulent misrepresentation
d) Price gouging
7. Causes of an incident are determined by:
a) Personal observations only
b) Witness testimonies only
c) Official reports only
d) Observations and interactions with various sources
8. Misrepresenting cause of death in livestock insurance is:
a) Accurate reporting
b) Honest declaration
c) Distorting cause of death for claim
d) Transparent communication
9. Insurable interest requires:
a) Financial benefit on safety and loss on damage
b) Financial responsibility only
c) Personal connection with agent
d) Ownership of insurer
10. Monthly enquiries to Insurance Reference Service (Australia):
a) 10,000
b) 25,000
c) 50,000
d) 75,000
11. Alternate term for soft fraud:
a) Intentional frauds
b) Hard frauds
c) Insider frauds
d) Opportunistic frauds
12. Risk inspection helps by:
a) Reducing premiums
b) Extending coverage
c) Increasing market value
d) Identifying and preventing fraud
13. Anti-fraud legislation guideline is given by:
a) IAIS Principles
b) IFRS
c) IAS
d) IAFG
14. NAIC is governed by:
a) Federal Insurance Commission
b) Chief Insurance Regulators of states
c) National Insurance Supervisory Council
d) Insurance Regulatory Authority
15. Fraud trigger in fire insurance:
a) Increase in premium
b) Increase in policy period
c) Increase in sum insured before loss
d) Proper documentation
16. Barratry in marine insurance occurs when:
a) Vessel deliberately sunk for fraud
b) Collision
c) Wear and tear
d) Storm damage
17. Policy with cashless treatment provision:
a) Indemnity health policy
b) Critical illness policy
c) Group health insurance policy
d) Overseas health insurance policy
18. Insurance plan designed for specific customer needs:
a) Traditional plan
b) Term plan
c) Pure endowment
d) Unit Linked plan
19. Liability policy limits are:
a) Annual & Monthly
b) Occurrence & Aggregate
c) Deductible & Comprehensive
d) AAL & APL
20. Premium collection timeline (> ₹1,00,000, non-face-to-face):
a) Within 7 days
b) Within 30 days
c) Within 15 days
d) Within 60 days
