Insurance MCQ Questions and Solutions with Explanations | Commerce

If the underwriter feels that the risk is more, he may impose a lien. An insurance contract represents a guarantee by an insurer that it will pay for damages and losses caused by covered perils. Creating insurance policies, or underwriting, typically represents the insurer's primary source of revenue.

Both the statements are correct.
The schedule of a policy is not altered after the policy is issued. After the policy is issued, the policyholder in a number of cases finds the terms not suitable to him and desires to change them. LIC allows certain types of alterations during the lifetime of the policy. However, no alteration is permitted within one year of the commencement of the policy with some exceptions.
Changes in the terms of the policy are made through endorsements. Technically, an endorsement is a document that incorporates amendments and additions in the existing terms of the policy. It is a written evidence of an agreed change to the policy.

The date of issue of the FPR indicates the date when the risk effectively begins.

In the case of SSS policies, FPRs are issued. SSS is like an insurance program mandated by the government to all income earners or workers in the Philippines.

Both the statements are incorrect.
Assignee is not free from the assignor’s obligations under the policy. A nomination is not cancelled when a loan is taken under the policy.

Both the statements are incorrect.
The beneficiaries under the MWP Act cannot be any member of the family. A policy cannot be taken under the MMWP Act for the benefit of parents.

Foreclosure can be done only after informing the policyholder. Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan.

Both the statements are incorrect. Revivals can be done before the entire outstanding premium is paid. Revivals can be done before the underwriter agrees.

Foreclosure action cannot be taken till a notice is served on the policyholder. Foreclosure” is just the series of steps a lender has to take in order to force the sale of such property and use the sale proceeds to recover its unpaid debt.

Both the statements are correct.
A presumption of death is not the same as proof of death. Presumption of death allows inheritance of property.