Insurance Awareness Quiz |5th December 2018

Dear Aspirants, Welcome to Insurance Awareness Questions in ambitiousbaba.com. Here we are covering some important questions for insurance exams.

Question 1: Life insurance is usually divided into 2 broad categories

a. Health insurance b. Health insurance c. Annuities d. Investment linked contracts

(A) a and b

(B) b and c

(C) a and c

(D) b and d

(E) None of these

Question 2: If policy holder wants to shift existing investment from an equity fund to a debt fund it is known as

(A) transfer of funds           

(B) switching                        

(C) Redirection                    

(D) none

(E) All of the above

Question 3: In pension scheme when the pension amount is known beforehand it is known as

(A) guaranteed benefit pension scheme               

(B) group superannuation

(C) defined contribution                                         

(D) defined benefit scheme

(E) None of these

Question 4: Risk of suffering disability is which type of risk:

(A). Homogeneous   

(B) Speculative risk

(C) Fundamental      

(D) Financial

(E) None

Question 5: In Traditional Life Insurance product, investment risk is with

(A) Insurance Company      

(B) Policy Holder                 

(C) Govt.

(D) None

Question 6: _________ is the liability of individuals, corporations, or partnerships for accidents caused by people other than employees for whose acts or omissions the corporations or partnerships are responsible.
(A) Contingent Beneficiary
(B) Contingent Liability
(C) Contractual Liability
(D) Convertible

(E) None of these

Question 7: Commercial coverage against losses resulting from the failure of business debtors to pay their obligation to the insured, usually due to insolvency is termed as ______
(A) Credit Insurance
(B) Contingent Liability
(C) Contractual Liability
(D) Convertible

(E) None of these

Question 8: The ratio of losses incurred to premiums earned; anticipated when rates are first formulated is termed as_______
(A) Expected Loss Ratio
(B) Expense Ratio
(C) Extended Coverage
(D) Extra Expense Insurance

(E) None of these

Question 9: An endorsement added to an insurance policy, or clause within a policy, that provides additional coverage for risks other than those in a basic policy is termed as ______
(A) Expected Loss Ratio
(B) Expense Ratio
(C) Extended Coverage
(D) Extra Expense Insurance

(E) None of these

Question 10: Advantages of Reinsurance

(A)helps in reserving methodology     

(B)helps in investment management

(c) helps in designing and pricing of new product          

(D) a & c

(E) All of the above

SOLUTION

  1. B
  2. B
  3. D
  4. C

Financial related wth finance. Speculative risk gambling. Homogenious is not a type of risk. Death illness disabilty etc comes under fundamental risk

  1. A
  2. B

A contingent liability is a potential obligation that may be incurred depending on the outcome of a future event.

  1. A

Credit insurance is a type of life insurance policy purchased by a borrower that pays off one or more existing debts in the event of a death, disability, or in rare cases, unemployment.

  1. A

It is a technique used to determine the projected amount of claims relative to earned premiums.

  1. C

Extended coverage is a term used in the property insurance business. All insurance policies have exclusions specific causes of loss also called “perils” that are not covered by the insurance company.

  1. C

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