IC46 - General Insurance A_c Preparation Mock Test 19
These questions cover underwriting, insurance reserves, accounting systems, reinsurance, liabilities, investment accounting, employee benefits, cash books, and bonus issues. Underwriting concepts include complete underwriting and the responsibility of an underwriter for unsubscribed securities. Unexpired risk is related to technical reserves in insurance accounting. The questions also examine accounting system classifications and surplus share reinsurance, where the retained risk is expressed as a fixed monetary amount. Other topics include liabilities arising from borrowing and past obligations, investment accounting for insurers, post-employment benefits such as gratuity and pensions, treaty reinsurance, cash journals, and SEBI guidelines concerning bonus issues.
1. What refers to the situation where the whole of the issue has been underwritten by one person, and the underwriter is responsible for subscribing for all the shares or debentures that have not been subscribed by the public?
a) Partial underwriting
b) Market underwriting
c) Marked underwriting
d) Complete underwriting
2. What is also referred to as Unexpired Risk?
a) Premium income
b) Technical Reserves
c) Cost incurred
d) Practical reserves
3. How many types of Accounting systems are there?
a) One
b) Two
c) Three
d) Four
4. Similar to quota share, except that the portion of risk retained by the direct insurer is expressed as a fixed monetary amount is referred to as ______.
a) Quota share
b) Surplus share
5. What refers to obligations of the enterprise arising from the borrowing made by the promoters, shareholders and past performances, the settlement of which is expected to make use of the enterprise's resources?
a) Liabilities
b) Assets
c) Equity
d) Revenue
6. What refers to the investments treated as assets held by an insurer for earning income by way of dividends, rent and interest or for capital appreciation or for other benefits to both policyholders and shareholders?
a) Investment accounting
b) Reinsurance
c) Bancassurance
d) Discounting
7. Q13) Which benefits provide such benefits as gratuity, pension, other retirement benefits, post-employment life insurance and post-employment medical care?
a) Short-term employee benefits
b) Other long-term employee benefits
c) Post-employment benefits
d) None of these
8. A reinsurance contract under which the reinsured company agrees to cede and the reinsurer agrees to assume a particular class or classes of insurance business automatically is referred to as:
a) Inward reinsurance
b) Retrocession
c) Treaty
d) None of the above
9. Which of the following comes under Cash Journal?
a) Two columnar cash book
b) Purchase book
c) Bills payable book
d) Return outwards book
10. Which of the following is correct about SEBI Guidelines on bonus issue of a company?
a) Bonus issue shall be made within 12 months of any public issue
b) Reserve created by revaluation of assets can be capitalized for issue of bonus shares
c) Bonus issue shall not be made in lieu of dividend
d) None of these
