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Insurance MCQ Questions and Solutions with Explanations | Commerce

Insurance MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Insurance MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-10 section-4

Each section contains 100 MCQs on Insurance .
91
Which of the below is the most appropriate explanation for the fact that young people are charged lesser life insurance premium as compared to old people?
Discuss
Answer & Solution
Answer: Option C
Solution:
Mortality is related to age and hence young people who are less likely to die are charged lower premiums as compared to old people. The level premium is a premium fixed such that it does not increase with age but remains constant throughout the contract period.
92
Which of the below is not an advantage of cash value insurance contracts?
Discuss
Answer & Solution
Answer: Option C
Solution:
Lower yields is not an advantage of cash value insurance contracts. Cash value insurance is permanent life insurance because it provides coverage for the policyholder's life. Traditionally, cash value insurance has higher premiums than term insurance because of the cash value element.
93
Which of the below is an advantage of cash value insurance contracts?
Discuss
Answer & Solution
Answer: Option D
Solution:
Secure investment is an advantage of cash value insurance contracts. Cash value life insurance provides more financial flexibility. Because cash values have the potential to grow inside the policy, you may be able to access the cash value while you are living.
94
Which element of a valid contract deals with premium?
Discuss
Answer & Solution
Answer: Option B
Solution:
Consideration of a valid contract deals with premium. A consideration is an exchange of money for the guarantee of an act preformed or another benefit provided. In the context of insurance, the insurance company gives the consideration of coverage for losses as long as premiums are paid.
95
_________ involves pressure applied through criminal means.
Discuss
Answer & Solution
Answer: Option C
Solution:
Coercion involves pressure applied through criminal means. When a person who is able to dominate the will of another, uses her position to obtain an undue advantage over the other.
96
Which among the following is true regarding life insurance contracts?
Discuss
Answer & Solution
Answer: Option C
Solution:
They are contracts between two parties (insurer and insured) as per requirements of Indian Contract Act, 1872 is true about life insurance contracts.
97
Which of the below is not a valid consideration for a contract?
Discuss
Answer & Solution
Answer: Option C
Solution:
Bribe is not a valid consideration for a contract. Bribery is the act of giving or receiving something of value in exchange for some kind of influence or action in return, that the recipient would otherwise not offer.
98
Which of the below party is not eligible to enter into a life insurance contract?
Discuss
Answer & Solution
Answer: Option B
Solution:
Minor is not eligible to enter into a life insurance contract. However, although a minor child has insurable interest in the life of his/her earning parents, but children can't take insurance for parents because, as a minor, a child can't enter into a contract.
99
Find out the proximate cause for death in the following scenario?
Ajay falls off a horse and breaks his back. He lies there in a pool of water and contracts pneumonia. He is admitted to the hospital and dies because of pneumonia.
Discuss
Answer & Solution
Answer: Option C
Solution:
Falling off a horse is the proximate cause for death in the given scenario.
100
An individual with an aggressive risk profile is likely to follow wealth _________ investment style.
Discuss
Answer & Solution
Answer: Option C
Solution:
An individual with an aggressive risk profile is likely to follow wealth accumulation investment style.