IC39 Mock Test Sample 3
Fraud in insurance, as defined under the Indian Contract Act, includes misrepresentation and active concealment of facts. Common frauds involve misrepresentation of medical history, exaggerated claims, and false property declarations. Principles like utmost good faith and insurable interest are essential for valid contracts. Investigators focus on identifying the true cause and extent of loss using tools like forensic analysis. Marine insurance may use agreed value for claim settlement. Regulatory bodies like IRDAI define group insurance norms. Unethical practices such as mis-selling must be avoided. Legal provisions impose penalties for violations, while suspicious behaviors like lack of purchase proof may indicate potential fraud.
1. According to Section 17 of the Indian Contract Act 1872, fraud is defined as which of the following acts?
a) Suggesting as a fact something not true
b) Active concealment of a fact
c) Both A and B
d) None of the above
2. What is one of the most common and regular frauds in health insurance?
a) Misrepresentation of medical history
b) Pre-existing disease fraud
c) Exaggeration of cost
d) Collusion between policyholders and representatives
3. Overseas Health Insurance is designed to cover:
a) Travel within own country
b) Foreign nationals traveling to India
c) Individuals traveling and staying abroad
d) Permanent residents of foreign countries
4. Which plan offers both death and survival benefits?
a) Whole Life Policy
b) Term Assurance Plan
c) Money Back Policy
d) Endowment Assurance Plan
5. Risk management requires proposal information like:
a) Financial status
b) Family status
c) Health condition
d) All of the above
6. Primary objective of an investigator in loss cases:
a) Increase premium
b) Expedite claim
c) Establish legal liabilities
d) Determine cause and extent of loss
7. When might a proposal form not be filled out?
a) Applying for credit card
b) Renting property
c) Applying for job
d) Seeking medical treatment
8. Marine insurance claim settlement is based on:
a) Market value
b) Insured value at inception
c) Depreciated value
d) Agreed value
9. Definition of "group" in group health insurance is given by:
a) IRDAI
b) WHO
c) Health Ministry
d) Insurance company
10. Non-disclosure of prior losses breaches:
a) Goodwill
b) Ethics
c) Upright behavior
d) Utmost good faith
11. Insurance Reference Service in Australia was established in:
a) 1985
b) 1991
c) 2000
d) 2005
12. Penalty for appointing unregistered intermediary:
a) ₹10 lakh
b) ₹50 lakh
c) ₹1 crore
d) ₹5 crore
13. Inland Transit Clause covering fire risk only:
a) Clause A
b) Clause B
c) Clause C
d) Clause D
14. Legal relationship in insurance is called:
a) Policy terms
b) Regulations
c) Premium
d) Insurable interest
15. Unethical practice to avoid:
a) High commission products
b) Selling expensive policies
c) Aggressive marketing
d) Recommending unsuitable products
16. Role of forensic science in claims:
a) Secondary tool
b) Only legal use
c) Irrelevant
d) Primary tool to determine cause
17. Claiming higher loss than actual is:
a) Exaggeration of loss fraud
b) Fictitious claim
c) Inflated coverage
d) Overstatement scam
18. Which is a type of insurance fraud?
a) Providing correct details
b) Valid claim after policy start
c) Correct valuation
d) Claim without insurable interest
19. New name of GIC after 1999:
a) LIC
b) National Insurance
c) Oriental Insurance
d) Indian Re
20. Suspicious situation in fire insurance:
a) Providing receipts
b) Full documentation
c) No purchase receipts
d) Timely claim reporting
