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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-3 section-3

Each section contains 100 MCQs on Insurance .
21
Which of the following could be the basis of the cover in a group policy?
Discuss
Answer & Solution
Answer: Option B
Solution:
Age of the life insured could be the basis of the cover in a group policy. Group insurance may offer life insurance, health insurance, and/or some other types of personal insurance.
22
Which of the following statements are “TRUE”?
1: In a group policy, each person is free to choose the amount of insurance cover.
2: A person, normally uninsurable, can be covered under a group insurance policy.
Discuss
Answer & Solution
Answer: Option A
Solution:
In a group policy, each person is free to choose the amount of insurance cover.
23
An insurance broker represents
Discuss
Answer & Solution
Answer: Option B
Solution:
An agent represents the insurance company, whereas a broker represents an insured.
24
Which of the following statements in respect of riders is incorrect?
Discuss
Answer & Solution
Answer: Option A
Solution:
A rider is an add-on cover to the base policy that provides additional benefits. Under this, if death of the policyholder occurs due to an accident then, apart from paying the life insurance benefit promised under the base policy, the policy will also pay an additional sum insured as specified in the rider.
25
Distribution of terminal bonuses is a way out for insurance companies to
Discuss
Answer & Solution
Answer: Option C
Solution:
Distribution of terminal bonuses is a way out for insurance companies to Reward the policyholders for ins.cos' unrealized gains and achieve equity among different generations of policyholders.
26
_________ as a profession refers to the act of inducing a commercial transaction through inducing the purchase of a product or service. Such act is carried out with the intent of earning remuneration.
Discuss
Answer & Solution
Answer: Option B
Solution:
Selling as a profession refers to the act of inducing a commercial transaction through inducing the purchase of a product or service. Such act is carried out with the intent of earning remuneration.
27
Expand the term IGMS.
Discuss
Answer & Solution
Answer: Option C
Solution:
The Integrated Grievance Management System(IGMS) facilitates online registration of policyholders' complaints and helps track their statuses.
28
Which of the following are incorrect?
1. Mutuality means funds from various individuals are combined.
2. Diversification means spreading out funds to various destinations.
Discuss
Answer & Solution
Answer: Option D
Solution:
Mutuality means flow of resources from many to one. Diversification is a risk management technique that mixes a wide variety of investments within a portfolio.
29
Selecting an appropriate investment vehicle would not depend on
Discuss
Answer & Solution
Answer: Option D
Solution:
Selecting an appropriate investment vehicle would not depend on Insurability.
30
Surplus not distributed (retained earnings) could contribute to
Discuss
Answer & Solution
Answer: Option B
Solution:
Retained earnings refer to the percentage of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business or to pay debt. Retained earnings contribute to the financial soundness of the company.