Insurance
Insurance MCQs with Answers and Explanations | Life, Health & General Insurance Objective Questions
Enhance your understanding of Insurance and Risk Management with our comprehensive collection of MCQs with answers and detailed explanations. Topics include principles of insurance, life insurance, health insurance, fire insurance, marine insurance, reinsurance, risk management, premium calculation, claims settlement, insurance laws, and regulatory framework. These objective questions are ideal for students, teachers, and candidates preparing for competitive and professional exams (CA, ACCA, ICMA, MBA, BBA, CSS, PMS, NTS, FPSC, PPSC, UPSC, insurance licensing exams, etc.). Each MCQ is followed by a clear explanation to strengthen concepts, improve problem-solving skills, and boost exam performance. Perfect for practice, revision, and self-assessment in the field of Insurance.
A) Only I
B) Only II
C) Both I and II
D) Neither I nor II
✅ ANSWER: B
A keyman life insurance policy is a policy that a company purchases on a key executive’s life. The company is the beneficiary of the plan and pays the insurance policy premiums. It is also known as “key man insurance”, “key woman insurance” or “business life insurance.”
A) Nominee, Assignee
B) Appointee, Assignee
C) Assignor, Assignee
D) Lender, Loanee
✅ ANSWER: C
The person who transfer rights is called Assignor and the person who receives the right is called Assignee.
A) High
B) Low
C) Moderate
D) None of the three
✅ ANSWER: B
In the initial years of a ULIP, the value of the benefits would be low.
A) Claim may be settled on the basis of an indemnity bond
B) An advertisement may have to be placed in a newspaper if the amount to be paid is high
C) Both A & B
D) None of the above
✅ ANSWER: C
If a policy document is lost, then claim may be settled on the basis of an indemnity bond and an advertisement may have to be placed in a newspaper if the amount to be paid is high.
A) In interview of the prospect agent is knowledge alone is not important
B) Listening is not important as the prospect may not know much about life insurance
C) The agent should avoid being judgmental. It is necessary for the agent to pay
D) Attention to what the prospect says as also to his body language
✅ ANSWER: B
Listening is important as the prospect may not know much about life insurance.
A) One where the annuity amount is fixed (guaranteed)
B) One where the annuity amount is variable (linked to investment performance)
C) Both A & B
D) None of the above
✅ ANSWER: C
Annuity belongs to one where the annuity amount is fixed (guaranteed) and one where the annuity amount is variable (linked to investment performance).
A) Annuity would continue
B) Annuity would cease
C) A & B correct
D) None of the above
✅ ANSWER: B
In a joint life annuity, Annuity would cease if the spouse is to predeceased the annuitant.
A) Employees of a company
B) Credit card holders of an organisation
C) Professional association members
D) Group of unrelated individuals formed for the purpose of availing group health insurance
✅ ANSWER: D
Group of unrelated individuals formed for the purpose of availing group health insurance would not be eligible for a group health insurance policy.
A) A Term Insurance policy cannot be convered into any other policy during its duration
B) Term policy is available both a separate policy and as a rider in another policy
C) Term policy can be issued with lifelong renewability option
D) All Term covers will have a disability rider
✅ ANSWER: B
Term policy is available both a separate policy and as a rider in another policy.
A) The benefits shall be stated at the outset
B) The benefits shall be linked to some index
C) The additional benefit under these policies shall be laid out at the outset
D) The return shall be stated at the beginning of the contract itself
✅ ANSWER: B
The benefits of an insurance policy are not linked to any index. Hence, option (2) is the correct answer.