356 + Mcqs in Principles Page 3 McqOptions

101.	Can a marine policy be assigned?
A.	Can be assigned before the loss
B.	Can be assigned after the loss
C.	cannot be assigned
D.	both a and b
Answer» D. both a and b

Discussion

102.	Group insurance is ideally suited for covering
A.	Affluent persons in the society
B.	Weaker sections of the society
C.	Employer-employee groups
D.	Both B. and C.
Answer» C. Employer-employee groups

Discussion

103.	Which type of insurance protects the policyholder against loss or damage to a ship or its cargo on the high seas?
A.	Hazards
B.	Inland
C.	Transportation
D.	Mariney
Answer» E.

Discussion

104.	Transfer of rights and remedies of the insured to the insurer after indemnity has beeneffected is called __________.
A.	Insurable interest.
B.	Subrogation
C.	Proximate clause.
D.	Money back policy.
Answer» C. Proximate clause.

Discussion

105.	The first step in risk management process is
A.	Risk avoidance
B.	Risk identification
C.	Insurance
D.	Risk evaluation
Answer» E.

Discussion

106.	Insurance covers the risk of the most certain event -
A.	Death of a person
B.	protection of the childhood
C.	protection of old age
D.	all of the above
Answer» C. protection of old age

Discussion

107.	Which of the following is true? A. Policy form is a legal document. B. The warranties inserted in a policy safeguard the interest of the insured.
A.	A is True
B.	B is True
C.	Both are true
D.	Neither is true
Answer» C. Both are true

Discussion

108.	The general insurance business in India was nationalized in the year.
A.	1976
B.	1956
C.	1983
D.	1972
Answer» E.

Discussion

109.	Endorsement can be used in a policy giving effect to
A.	Renewal
B.	Change in Premium
C.	Change in subject matter of insurance
D.	All of the above
Answer» E.

Discussion

110.	The concept of insurance is
A.	to share losses by many
B.	to make money out of death
C.	to earn interest
D.	to earn a status
Answer» B. to make money out of death

Discussion

111.	On the death of the bread-earner, two losses occur in the family-one is loss of human life and the other
A.	Earning power of family
B.	Loss of insurance
C.	Loss of investments
D.	Loss of bank deposits
Answer» B. Loss of insurance

Discussion

112.	Consideration on the part of the life insured in respect of a life insurance contract is
A.	A promise to take a new policy
B.	The insured’s promise to pay the premium under the policy.
C.	The payment made towards premium by the insured.
D.	Proposal completed and signed by the person.
Answer» C. The payment made towards premium by the insured.

Discussion

113.	__________ policy matures on the assured death or on his attainment of a particular age whichever occurs earlier.
A.	Endowment.
B.	Money back.
C.	Joint life
D.	Single premium.
Answer» B. Money back.

Discussion

114.	In case of life insurance, insurable insurance should not exist?
A.	At the inception of the policy.
B.	At the time of a claim.
C.	At the time of every renewal premium payment.
D.	All the above occasions.
Answer» B. At the time of a claim.

Discussion

115.	Notification of Alterations in Risk is a condition
A.	Precedent to liability
B.	Subsequent to liability
C.	Precedent to the contract
D.	Subsequent to the contract
Answer» B. Subsequent to liability

Discussion

116.	Insurable Interest is defined by:
A.	The Insurance Act
B.	The Contracts Act
C.	By IRDA
D.	Not defined in any written law
Answer» E.

Discussion

117.	Occupation is important for risk classification because of:
A.	Income earned by individual
B.	Tension, stress and worries given by workplace
C.	damage caused by pollution at work place
D.	both b and c
Answer» E.

Discussion

118.	Which of the statements is correct? Under a fire policy A. Insurance is a transfer of risk mechanism. B. Insurance gives physical protection to assets.
A.	Statement A. is correct
B.	Statement B. is correct
C.	Both are correct
D.	Neither is correct
Answer» C. Both are correct

Discussion

119.	All of the following are disadvantages of using insurance EXCEPT
A.	There is an opportunity cost because premiums must be paid in advance.
B.	Considerable time and effort must be spent selecting and negotiating coverages.
C.	It results in considerable fluctuations in earnings after a loss occurs.
D.	Attitudes toward loss control may become lax.
Answer» D. Attitudes toward loss control may become lax.

Discussion

120.	Which of the statement are true? A. Risk retention and risk transfer are some of the techniques to manage risks. B. Implementation is one of the steps in risk management
A.	Statement A.
B.	Statement B.
C.	Both the statements
D.	Neither of the statements
Answer» D. Neither of the statements

Discussion

121.	Risk of premature death is a
A.	Financial risk
B.	Personal risk
C.	Dynamic risk
D.	Subjective risk
Answer» C. Dynamic risk

Discussion

122.	Following are the risk management methods:
A.	Insurance
B.	Hedging
C.	Derivatives
D.	All of the above
Answer» E.

Discussion

123.	Insurance brokers are governed by
A.	Sale of Goods Act
B.	Agency Law
C.	IRDA Act. 1999
D.	Mercantile Law
Answer» D. Mercantile Law

Discussion

124.	The cause of loss or a contigency that may cause a loss is known as--------------
A.	Hazard
B.	peril
C.	Risk
D.	Uncertainty
Answer» E.

Discussion

125.	Event of high frequency and low severity fall in the self-retention category
A.	True
B.	False
C.	none
D.	all
Answer» B. False

Discussion

126.	Which one of the following comes under miscellaneous insurance?
A.	Marine Insurance
B.	Motor Insurance
C.	Fire Insurance
D.	Group Insurance
Answer» C. Fire Insurance

Discussion

127.	Which of the following is the main objective of IRDA:
A.	To take care of the policy holder interest
B.	To open the insurance sector for private sectors
C.	To supervise the activities of intermediaries
D.	All of above
Answer» B. To open the insurance sector for private sectors

Discussion

128.	Which of the following is the similarity between insurance and gambling?
A.	The amount of loss to be paid is known beforehand
B.	Promise to pay on the happening of an event
C.	Both the parties win on happening of an event
D.	Both are enforceable at law
Answer» B. Promise to pay on the happening of an event

Discussion

129.	The insurance plays a role in the economic development of the country in following ways:
A.	Release capital for new investments.
B.	The job potential increases
C.	Money collected is invested in infrastructure
D.	All of the above
Answer» E.

Discussion

130.	Akshat is a relatively cautious person. In insurance terms, this will normally increase thelikelihood that he will
A.	be considered an above average insurance risk.
B.	be considered a below average insurance risk.
C.	require insurance cover.
D.	require reinsurance cover.
Answer» D. require reinsurance cover.

Discussion

131.	A reinsurance of insurance refers to ________.
A.	line.
B.	retention.
C.	retrocession.
D.	cession.
Answer» D. cession.

Discussion

132.	The principle of utmost good faith does not apply to :
A.	Facts of common knowledge
B.	Facts of Law
C.	Facts which are not material for underwriting
D.	All the three kinds of facts mentioned above.
Answer» E.

Discussion

133.	Which of the following is an accidental loss by fire?
A.	loss of profit on account of fire
B.	loss on account of delay
C.	Damage caused by a fire brigade in carrying out its fire fighting operation.
D.	Loss of market
Answer» C. Damage caused by a fire brigade in carrying out its fire fighting operation.

Discussion

134.	Insurance cover
A.	Protects assets
B.	prevents loss
C.	reduces the impact of loss
D.	insures immortality
Answer» D. insures immortality

Discussion

135.	The term risk may be defined as:
A.	The possibility of adverse results flowing from any occurrence.
B.	The possibility of an outcome being different from the expected one.
C.	Both a and b
D.	None of the above
Answer» D. None of the above

Discussion

136.	Risk management can be defined as the art and science of _________ risk factors throughout the life cycle of a project.
A.	Researching, reviewing, and acting on
B.	Identifying, analyzing, and responding to
C.	Reviewing, monitoring, and managing
D.	Identifying, reviewing, and avoiding
Answer» B. Identifying, analyzing, and responding to

Discussion

137.	IRDA Act. 1999 defines insurance intermediary as one including also
A.	Insurance broker
B.	UTI Agent
C.	Sarpanch
D.	Medical Examiner
Answer» B. UTI Agent

Discussion

138.	Which of the statement is correct? A. Existence of the subject-matter is an express condition. B. There are no implied conditions in insurance contracts
A.	A. is correct
B.	B. is correct
C.	Neither is correct
D.	Both the correct
Answer» D. Both the correct

Discussion

139.	Insurance reduces the extent of financial loss connected with uncertain events
A.	True
B.	False
C.	To the extent of insurance cover
D.	Does not reduce the loss at all
Answer» D. Does not reduce the loss at all

Discussion

140.	All of the following are financial risks which may be faced by business organizations EXCEPT
A.	Interest rate risk.
B.	Commodity price risk.
C.	Product liability risk.
D.	Currency exchange rate risk.
Answer» D. Currency exchange rate risk.

Discussion

141.	Cover note can be issued by
A.	Agents
B.	Development officers
C.	Insurers
D.	All of the above, depending on company guidelines
Answer» E.

Discussion

142.	The principle of indemnity is applicable to _______ only.
A.	Life Insurance
B.	Personal accident insurance
C.	Proximate Cause
D.	Property insurance
Answer» E.

Discussion

143.	Which of the statements are true? A. Loss prevention and loss reduction mean different things. B. Risk maybe transferred by contract.
A.	Statement A.
B.	Statement B.
C.	Both the statements
D.	Neither of the statements
Answer» C. Both the statements

Discussion

144.	The company doing insurance business is called:
A.	mutual funds
B.	non-banking firm
C.	banking company
D.	an insurance company
Answer» E.

Discussion

145.	Policy stamp needs to be affixed on the
A.	Endorsement
B.	Cover note
C.	Policy
D.	All of the above
Answer» D. All of the above

Discussion

146.	If the most impossible event is assigned a value of zero, then most inevitable event is assigned a value
A.	Of one
B.	Between zero and one
C.	Between zero to 10
D.	Between 10 to 100
Answer» E.

Discussion

147.	Insurance eliminates or decreases the uncertainty associated with occurrence of an event
A.	Correct
B.	Wrong
C.	Partially correct C.
D.	Totally misleading
Answer» D. Totally misleading

Discussion

148.	A complete proposal form contains the information about
A.	Moral hazard
B.	Physical hazard
C.	Personal history of proposer and identity of the property insurance
D.	All of the above
Answer» C. Personal history of proposer and identity of the property insurance

Discussion

149.	A person’s insurable interest in his own life is:
A.	Unlimited
B.	Limited
C.	10 times the husband’s salary
D.	None of the above
Answer» B. Limited

Discussion

150.	Which of the statements is correct? A. The simplest way to deal with a risk is to avoid it. B. This technique is always possible and practical.
A.	Statement A.
B.	Statement B.
C.	Both the statements
D.	Neither of the statements
Answer» E.

Discussion

Explore topic-wise MCQs in Horn Antenna.

Can a marine policy be assigned?

Group insurance is ideally suited for covering

Which type of insurance protects the policyholder against loss or damage to a ship or its cargo on the high seas?

Transfer of rights and remedies of the insured to the insurer after indemnity has beeneffected is called __________.

The first step in risk management process is

Insurance covers the risk of the most certain event -

Which of the following is true? A. Policy form is a legal document. B. The warranties inserted in a policy safeguard the interest of the insured.

The general insurance business in India was nationalized in the year.

Endorsement can be used in a policy giving effect to

The concept of insurance is

On the death of the bread-earner, two losses occur in the family-one is loss of human life and the other

Consideration on the part of the life insured in respect of a life insurance contract is

__________ policy matures on the assured death or on his attainment of a particular age whichever occurs earlier.

In case of life insurance, insurable insurance should not exist?

Notification of Alterations in Risk is a condition

Insurable Interest is defined by:

Occupation is important for risk classification because of:

Which of the statements is correct? Under a fire policy A. Insurance is a transfer of risk mechanism. B. Insurance gives physical protection to assets.

All of the following are disadvantages of using insurance EXCEPT

Which of the statement are true? A. Risk retention and risk transfer are some of the techniques to manage risks. B. Implementation is one of the steps in risk management

Risk of premature death is a

Following are the risk management methods:

Insurance brokers are governed by

The cause of loss or a contigency that may cause a loss is known as--------------

Event of high frequency and low severity fall in the self-retention category

Which one of the following comes under miscellaneous insurance?

Which of the following is the main objective of IRDA:

Which of the following is the similarity between insurance and gambling?

The insurance plays a role in the economic development of the country in following ways:

Akshat is a relatively cautious person. In insurance terms, this will normally increase thelikelihood that he will

A reinsurance of insurance refers to ________.

The principle of utmost good faith does not apply to :

Which of the following is an accidental loss by fire?

Insurance cover

The term risk may be defined as:

Risk management can be defined as the art and science of _________ risk factors throughout the life cycle of a project.

IRDA Act. 1999 defines insurance intermediary as one including also

Which of the statement is correct? A. Existence of the subject-matter is an express condition. B. There are no implied conditions in insurance contracts

Insurance reduces the extent of financial loss connected with uncertain events

All of the following are financial risks which may be faced by business organizations EXCEPT

Cover note can be issued by

The principle of indemnity is applicable to _______ only.

Which of the statements are true? A. Loss prevention and loss reduction mean different things. B. Risk maybe transferred by contract.

The company doing insurance business is called:

Policy stamp needs to be affixed on the

If the most impossible event is assigned a value of zero, then most inevitable event is assigned a value

Insurance eliminates or decreases the uncertainty associated with occurrence of an event

A complete proposal form contains the information about

A person’s insurable interest in his own life is:

Which of the statements is correct? A. The simplest way to deal with a risk is to avoid it. B. This technique is always possible and practical.