This quiz works best with JavaScript enabled. Home > General Knowledge > Indian Polity > Regulatory > Bodies > Development Authority Irda – Quiz 1 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Development Authority Irda Quiz 1 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is not an element of the life insurance business A) Principle of Mutuality. B) Asset. C) Risk. D) Subsidy. Show Answer Correct Answer: D) Subsidy. 2. Government of India transacts life insurancebusiness in India through which of the following A) LIC of India. B) GIC of India. C) Postal Life Insurance. D) All the above. Show Answer Correct Answer: C) Postal Life Insurance. 3. Life Insurance covers the risk of- A) Dying too early. B) Living too longer. C) Both are correct. D) Both are wrong. Show Answer Correct Answer: C) Both are correct. 4. THE TERM WHICH IS USED IN CASE OF LIFE INSURANCE COMPANIES( WHEN A POLICYHOLDER IS NOT IN A POSITION TO PAY THE FUTURE PREMIUMS ON HIS POLICY )? A) REINSURANCE. B) BONUS. C) ANNUITIES. D) SURRENDER. Show Answer Correct Answer: D) SURRENDER. 5. Find out proximate cause of death in the following scenario. Ajay falls off a horse and breaks his back.He lies there in a pool of water and contacts Pneumonia.He is admitted to hospital and dies because of Pneumonia A) Pneumonia. B) Broken Back. C) Falling off a horse. D) Surgery. Show Answer Correct Answer: C) Falling off a horse. 6. Providing social security is the obligation of ..... A) Individuals. B) State. C) Private companies. D) Insurance companies. Show Answer Correct Answer: B) State. 7. When is it essential for Insurable Interest to be present in case of life Insurance A) At the time of taking out Insurance. B) Insurable Interest is not required in case of Life Insurance. C) At the time of Claim. D) Either at the time of policy purchase or at the time of Claim. Show Answer Correct Answer: A) At the time of taking out Insurance. 8. Considering insuring an ordinary ball pen is anexample of- A) Don't risk more than you can afford to lose. B) Don't risk a lot for a little. C) Both are correct. D) Both are wrong. Show Answer Correct Answer: B) Don't risk a lot for a little. 9. Cost of the risk would ..... with the probability andamount of loss A) Increase. B) Decrease. C) Vary. D) None of the above. Show Answer Correct Answer: A) Increase. 10. Which is not a capacity to enter into contract? A) Minor. B) Major. C) Not disqualified under law. D) Sound mind. Show Answer Correct Answer: A) Minor. 11. Lease Hold ground rents are shown in A) Schedule 9 loans. B) Revenue a/c. C) Schedule 8 Investments. D) P & L a/c. Show Answer Correct Answer: C) Schedule 8 Investments. 12. For the year 2008, 2009, 2010 if the rate of gross profit were 15%, 20%, and 18%respectively, then the rate of Average gross profit for the year 2011 will be: A) 17.67%. B) 18.75%. C) 53%. D) 15%. Show Answer Correct Answer: A) 17.67%. 13. ..... involves pressure applied through criminal means A) Mistake. B) Coercion. C) Undue Influence. D) Fraud. Show Answer Correct Answer: B) Coercion. 14. Who among the following is best advised to purchase a term plan A) An individual who needs money at the end of Insurance term. B) An individual who needs insurance and has a high budget. C) An individual who needs insurance and has a low budget. D) An individual who needs an insurance product that gives high returns. Show Answer Correct Answer: C) An individual who needs insurance and has a low budget. 15. In Life Insurance, the policy amount is payable A) On the death of the Insured or an expiry of policy period whichever is earlier. B) After the death of the Insured. C) After the expiry of policy period. D) Only when Insured has incurred some loss. Show Answer Correct Answer: A) On the death of the Insured or an expiry of policy period whichever is earlier. 16. Who controls the capital market of India? A) NABARD. B) RBI. C) SEBI. D) IRDA. Show Answer Correct Answer: C) SEBI. 17. Number of Schedules to be prepared by Insurance companies for their Financial statement are: A) 26 Schedules. B) 10 Schedules. C) 12 Schedules. D) 15 Schedules. Show Answer Correct Answer: D) 15 Schedules. 18. Which of the following reasons is not responsible for the ups and downs in the Sensex? A) Rain. B) Monetary Policy. C) Political instability. D) None of the above. Show Answer Correct Answer: D) None of the above. 19. The losses of a few are shared among many throughthe mechanism of- A) Nuclear family. B) Insurance. C) Government. D) All the above. Show Answer Correct Answer: B) Insurance. 20. Claims paid by LIC is shown in: A) Schedule 3. B) Schedule 4. C) Schedule 2. D) Schedule 1. Show Answer Correct Answer: B) Schedule 4. 21. WHO REGULATES INSURANCE SECTOR IN INDIA? A) RBI. B) SEBI. C) IRDA. D) NONE OF THE ABOVE. Show Answer Correct Answer: C) IRDA. 22. In commercial contracts, the principle to be observedis- A) Proximity. B) Indemnity. C) Uberrima Fides. D) Caveat Emptor. Show Answer Correct Answer: D) Caveat Emptor. 23. Which of the below is the advantage of cash value contracts A) Lower Yields. B) Low accumulation in earlier years. C) Secure Investment. D) Returns subject to corroding effect of inflation. Show Answer Correct Answer: C) Secure Investment. 24. Which of the following is correct? Statement A-Insurance reduces burdensStatement B-Insurance is a system of mutualsupport.Statement C-Insurance the only method tomanage risks A) A, B & C correct. B) A & B correct. C) A is correct. D) B is correct. Show Answer Correct Answer: B) A & B correct. 25. Which of the following is correct? Statement A. The system of insurance benefitsindividual, family and the societyStatement B. Insurance companies could invest inspeculative ventures. A) A is correct. B) B is correct. C) Both A and B correc. D) A & B wrong. Show Answer Correct Answer: A) A is correct. 26. ..... means every party to an insurance contractmust disclose all material information. A) Indemnity. B) Proximity. C) Uberrima Fides. D) Insurable Interest. Show Answer Correct Answer: C) Uberrima Fides. 27. As per HLV concept, the amount of insurance onecan buy could be ..... times of one's annual income A) 25 to 50 times. B) 5 to 10 times. C) 50 to 100 times. D) 10 to 15 times. Show Answer Correct Answer: D) 10 to 15 times. 28. ..... rserve is a reserve to be created to meet any loss due to Natural Calamities, A) Catastrophe Reserve. B) General Reserve. C) Capital Reserve. D) Revenue Reserve. Show Answer Correct Answer: A) Catastrophe Reserve. 29. Life insurance policy, in general, is a mixture of- A) Protection and security. B) Insurance and Assurance. C) Protection and Savings. D) Protection and Tax relief. Show Answer Correct Answer: C) Protection and Savings. 30. Material facts are those that would help the insurer todecide: A) The acceptability of risk. B) The rate of premium to be charged. C) Both A and B correct. D) None are correct. Show Answer Correct Answer: C) Both A and B correct. 31. Human Life Value can be arrived at by dividing ..... by ..... A) Net earnings, Rate of interest. B) Gross earnings, Rate of interest. C) Net earnings, Gross earnings. D) Gross earnings, Net earnings. Show Answer Correct Answer: A) Net earnings, Rate of interest. 32. Insurance business in india is now regulated by the provisions of: A) The Banking Regulation Act 1949. B) The IRDA act 1999. C) The Indian Companies Act 1956. D) The Insurance Act 1938. Show Answer Correct Answer: B) The IRDA act 1999. 33. The balance found in the revenue account of LIC is considered as ..... A) Surplus / Deficit. B) Life Assurance Fund. C) Net Profit / Net Loss. D) Gross Profit / Gross Loss. Show Answer Correct Answer: A) Surplus / Deficit. 34. What does inter temporal allocation of resources mean? A) Allocation of resources over time. B) Postponing allocation of resources until time is right. C) Temporary allocation of resources. D) Diversification of resource allocation. Show Answer Correct Answer: A) Allocation of resources over time. 35. Who devised the concept of HLV A) Warren Buffet. B) Prof Hubener. C) Dr.Martin Luther King. D) George Soros. Show Answer Correct Answer: B) Prof Hubener. 36. A valuation Balance sheet is prepared by A) Banking Company. B) General Insurance Company. C) Life Insurance Company. D) Joint stock company. Show Answer Correct Answer: C) Life Insurance Company. 37. HLV concept helps to determine the ..... limitbeyond which life insurance could be speculative. A) Upper. B) Lower. C) Middle. D) All the above. Show Answer Correct Answer: A) Upper. 38. A fire insurance policy is taken out to indemnify/ recover: A) Capital losses and revenue losses of tangible assets. B) Revenue losses of tangible assets. C) Capital losses of intangible assets. D) None of the above. Show Answer Correct Answer: A) Capital losses and revenue losses of tangible assets. 39. INSURANCE BUSINESS IS CONTROLLED BY? A) INSURANCE ACT 1938. B) INSURANCE RULES 1939. C) IRDA REGULATION 2002. D) ALL OF THE ABOVE. Show Answer Correct Answer: D) ALL OF THE ABOVE. 40. ..... life insurance pays off a policy holders mortgage in the event of the persons death A) Mortgage. B) Term. C) Whole. D) Endowment. Show Answer Correct Answer: A) Mortgage. 41. ..... means that insurer would assess and compensateonly the exact amount of loss. A) Certainty. B) Probability. C) Uncertainty. D) Indemnity. Show Answer Correct Answer: D) Indemnity. 42. Risk Retention means- A) Self-insurance. B) Insuring with another individual. C) Insuring with an insurance company. D) Insuring with the owner of the company. Show Answer Correct Answer: A) Self-insurance. 43. Which is not an element of a valid contract? A) Offer and Acceptance. B) Capacity to pay premiums. C) Consideration. D) Capacity of the parties. Show Answer Correct Answer: B) Capacity to pay premiums. 44. Secondary burden of risk consists of ..... and ..... one has to bear if exposed to loss situation A) Situations, Safeguards. B) Circumstances, Conflicts. C) Costs, Strains. D) Trials, tribulations. Show Answer Correct Answer: C) Costs, Strains. 45. With increase in premium with age, healthy peopletended to withdraw leaving unhealthy people. Thislead to development of- A) Gross premiums. B) Advance premiums. C) Single premiums. D) Level premiums. Show Answer Correct Answer: D) Level premiums. 46. In decreasing term insurance, the premiums paid ..... over time A) Are Returned. B) Increase. C) Remain Constant. D) Decrease. Show Answer Correct Answer: D) Decrease. 47. What is the relation between Investment horizon and returns A) Both are not related at all. B) Greater the Investment horizon, larger the returns. C) Greater the Investment horizon, smaller the returns. D) Greater the Investment horizon, more tax on the returns. Show Answer Correct Answer: B) Greater the Investment horizon, larger the returns. 48. The difference between standard turnover and actual turnover during the indemnity period is: A) None of the below. B) Short Sales. C) Actual Sales. D) Total Sales. Show Answer Correct Answer: B) Short Sales. 49. Which is the 'consideration' from the insured in aninsurance contract? A) Premium. B) Proposal. C) Understanding. D) Acceptance. Show Answer Correct Answer: A) Premium. 50. What is not prohibited in the latest Insurance Amendments A) Multi Level Marketing. B) Commission. C) Sharing of Commission. D) Rebates. Show Answer Correct Answer: B) Commission. 51. ..... refers to the amount payable by the insurer to the insured when the policy become due for payment. A) Claim. B) Expenses. C) Premium. D) Commission. Show Answer Correct Answer: A) Claim. 52. Which of the following is incorrect? Mutuality means funds from variousindividuals are combinedB. Diversification means spreading out funds tovarious destinations. A) A is correct. B) B is correct. C) Both. D) None. Show Answer Correct Answer: C) Both. 53. Appropriations like interim dividend, proposed final dividend in GIC business are shown in A) Profit & Loss A/c. B) P & L Appropriation A/c. C) Revenue A/C. D) Trading A/c. Show Answer Correct Answer: A) Profit & Loss A/c. 54. Consent is not said to be free when it is caused by A) Coercion. B) Fraud. C) Misrepresentation. D) All the above. Show Answer Correct Answer: D) All the above. 55. Which is not an example of social security schemesof the Government? A) Rajeev Gandhi Equity Scheme. B) Janata Personal Accident. C) Jan Arogya Scheme. D) Employees State Insurance Corporation. Show Answer Correct Answer: A) Rajeev Gandhi Equity Scheme. 56. ..... is an annual guaranteed and paid by the Insurance company as long as the insured is alive . A) Commission. B) Annuity. C) Premium. D) Bonus. Show Answer Correct Answer: B) Annuity. 57. Which element of a valid contract deals with premium A) Offer and Acceptance. B) Consideration. C) Free Consent. D) Capacity of parties to Contract. Show Answer Correct Answer: B) Consideration. 58. Which among the following is a method of risk transfer? A) Insurance. B) Real estate. C) Bank FD. D) Equity shares. Show Answer Correct Answer: A) Insurance. 59. Which among the following is a secondary burden of risk? A) Business interruption cost. B) Setting aside reserves as a provision for meeting potential losses in the future. C) Hospitalization costs as a result of heart attack. D) Goods damaged cost. Show Answer Correct Answer: B) Setting aside reserves as a provision for meeting potential losses in the future. 60. Out of 400 houses, each valued at Rs. 20, 000, on an average 4 houses get burnt every year resulting in a combined loss of Rs. 80, 000. What should be the annual contribution of each house owner to make good this loss? A) Rs.80/-. B) Rs.200/-. C) Rs.400/-. D) Rs.100/-. Show Answer Correct Answer: B) Rs.200/-. Next →Related QuizzesRegulatory QuizzesIndian Polity QuizzesDevelopment Authority Irda Quiz 2 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books