Insurance mcqs

✅ The correct answer is D.
An insurance contract has to fulfill the requirements of the Indian Contract Act, 1872. It determines the circumstances in which promises made by the parties to a contract shall be legally binding. Under Section 2(h), the Indian Contract Act defines a contract as an agreement which is enforceable by law.

✅ The correct answer is B.
A proposer with many dependents taking insurance is not a moral hazard. Moral hazard is a situation in which one party gets involved in a risky event knowing that it is protected against the risk and the other party will incur the cost. It arises when both the parties have incomplete information about each other.

✅ The correct answer is C.
Defined Benefit type and Defined contribution type is a type of Occupational pension.
A defined benefit pension plan is a type of pension plan in which an employer/sponsor promises a specified pension payment, lump-sum (or combination thereof) on retirement that is predetermined by a formula based on the employee’s earnings history, tenure of service and age, rather than depending directly on individual investment returns.
Defined contribution (DC) schemes are occupational pension schemes where your own contributions and your employer’s contributions are both invested and the proceeds used to buy a pension and/or other benefits at retirement.

✅ The correct answer is B.
Pension insurance contract is an insurance contract that specifies pension plan contributions to an insurance undertaking in exchange for which the pension plan benefits will be paid when the members reach a specified retirement age or on earlier exit of members from the plan.

✅ The correct answer is A.
Traditional cash value plans have several limitations. If you want to cash in your life insurance early and surrender your coverage to the insurer, you will receive the policy’s cash value minus fees.

✅ The correct answer is A.
Licence fees should be paid to Controller of Insurance. The operation of the Insurance Broker License in India is regulated by regulations issued by IRDAI.

✅ The correct answer is C.
Both the statements are correct.
Life insurance is a long term contract and General insurance is a short term contract. Traditional life insurance contracts include whole life, term life, annuities in payout status, long-term care and disability income. General insurance is a contract that covers any risk other than the risk of life. These contracts are of short term in nature – generally one year – and therefore, the policy renewal is required every year.

✅ The correct answer is D.
The insurer’s right to reject a claim under a policy is subject to Section 45 of the Insurance Act, 1938. Section 45 deals with the insurer’s right to reject a claim under a policy.

✅ The correct answer is B.
The secondary burden of risk consists of Costs and Strains one has to bear if exposed to loss situation.

✅ The correct answer is B.
Mahesh, aged 50 years, working in a coal mine is not likely to qualify under non-medical underwriting.