Insurance MCQ Questions and Solutions with Explanations | Commerce

Risk of longevity is best managed through pensions. Longevity risk is one of the biggest risks facing retirees. It refers to the risk of outliving your savings. Longevity issues arise as people enter retirement, generally with a fixed amount of money to fund their retirement years (either in the form of a lump sum or pensions), but with no idea of how long they will live and, therefore, no idea how long their money needs to last.

Health Insurance cover can come with life insurance cover provided by a life insurer. Health insurance policies offered by life insurance companies pay certain amount for a particular disease on claim settlement.

An inpatient seeking medical attention for his medical problem after admission in a hospital receiving medical attention and treatment while being there.

Policy claim money can be paid only to the named trustee as the policy is a separate trust. When the trust takes out a policy, please make sure it has a separate bank account to pay premiums and receive benefits.

Term policy proceeds under MWP Act is beyond the scope of the creditors. If the Insurance policy was purchased under MWP Act, creditors cannot claim any amount from the policy proceeds and thus the claimed amount becomes available to the nominees.

MRI policies is most suitable for a home loan mortgage. MRI is an insurance policy that provides financial protection for home loan borrowers and their families. Specifically, MRI helps settle outstanding home loan amounts in the event of death or total disablement of the borrowers.

In a 20 year endowment policy there can be provision for payment of premium only for a few years.

A policy lapses if the premium is not paid within the grace period. A policy lapses when you skip paying its premium, not just on the due date but even within the grace period—which is typically a month.

In determination of premium higher the rate of interest assumed the lower is the premium.