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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-2 section-2

Each section contains 100 MCQs on Insurance .
11
Which of the following is not a traditional type of product offered by insurance companies?
Discuss
Answer & Solution
Answer: Option D
Solution:
ULIP is a life insurance product which provides risk cover for the policy holder along with investment options to invest in any number of qualified investments such as stocks, bonds or mutual funds.
12
Which of the following is incorrect with regards to portfolio method?
Discuss
Answer & Solution
Answer: Option D
Solution:
All of the above are correct with regards to the portfolio method. The portfolio method is an accounting method that credits all funds on the specified current rate of interest, regardless of when the money was placed in the account.
13
Traditional cash value plans are also known as
Discuss
Answer & Solution
Answer: Option B
Solution:
Traditional cash value plans are also known as Bundled plans. Bundled plans consist of multiple types of health coverage that a consumer can purchase together, typically with one integrated premium. The plans are generally designed to complement each other, or to provide varying benefits.
14
To whom should licence fees be paid?
Discuss
Answer & Solution
Answer: Option A
Solution:
Licence fees should be paid to Controller of Insurance. The operation of the Insurance Broker License in India is regulated by regulations issued by IRDAI.
15
In a standard insurance policy document, the standard provisions section will have information on which of the following?
Discuss
Answer & Solution
Answer: Option C
Solution:
In a standard insurance policy document, the standard provisions section will have information on the rights and privileges and other conditions which are applicable under the contract.
16
_________ is an annuity with an infinite life and continuous annual payments.
Discuss
Answer & Solution
Answer: Option C
Solution:
Perpetuity is an annuity with an infinite life and continuous annual payments. As the name suggests, perpetuity is a bond or security with no fixed maturity date.
17
It would be advantageous to go for a family floater rather than non-floater due to the reason that
Discuss
Answer & Solution
Answer: Option C
Solution:
It would be advantageous to go for a family floater rather than non-floater due to the reason that higher cover would help any family member in case of high cost treatment and premiums are considerably lower than where cover is taken for individual members.
18
Declined life means
Discuss
Answer & Solution
Answer: Option B
Solution:
Declined life means Life to which insurance cover could not be granted at affordable cost. Its purpose it to protect insurance companies from applicants who may be lying about their current health conditions. Just because you have been previously denied life insurance does not mean you will be denied again.
19
Which of the following statements is correct?
Discuss
Answer & Solution
Answer: Option A
Solution:
Risk prevention aims at avoidance of loss through insurance. Insurance helps minimize the negative impacts of losses. While insurance is a reactive solution, it is always better – whenever possible – to avoid this type of events. Some risks are inevitable, but others can be minimized by taking preventative measures.
20
When an underwriter has to be very careful?
Discuss
Answer & Solution
Answer: Option B
Solution:
An underwriter is an investment bank that helps companies introduce their new securities to the market. In the insurance business, an underwriter is a company liable for insured losses in return for a fee (premium).