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Insurance Sector General Knowledge Questions

1.

The headquarters of IRDA is located in –
[A]Delhi
[B]Mumbai
[C]Chennai
[D]Hyderabad

Hyderabad
The headquarters of Insurance Regulatory and Development Authority (IRDA) of India is located in Hyderabad.

2.

In context of heath insurance, under which policy the insurer pays the total or partial amount of the insured person’s hospital bills?
[A]Hospitalization policy
[B]Hospital Daily Cash Benefit policy
[C]Critical Illness benefit policy
[D]All of the above

Hospitalization policy
The Hospitalization policy covers, fully or partly, the actual cost of the treatment for hospital admissions during the policy period. This is a wider form of coverage applicable for various hospitalization expenses, including expenses before and after hospitalization for some specified period. Such policies may be available on individual sum insured basis, or on a family floater basis where the sum insured is shared across the family members.

3.

Under which section of Income Tax Act, the insured person can claim for tax deduction for the amount invested in insurance?
[A]section 80D
[B]section 81D
[C]section 83D
[D]section 79D

Section 80D
Under section 80D of the income tax act, the insured person who takes out the policy can claim for tax deduction for the amount invested.

4.

On which date, Life Insurance Corporation of India (LIC) was established?
[A]January 19,1956
[B]September 1,1956
[C]August 19,1956
[D]December 1,1956

September 1,1956
As per the Life Insurance Corporation Act, 1956, Life Insurance Corporation of India (LIC) was founded by Government of India on September 1,1956.

5.

Which term refers to termination of a policy due to failure to pay the required renewal premium.
[A]Actuary
[B]Annuity
[C]Policy Lapse
[D]CMO

Policy Lapse
Policy Lapse refers to termination of a policy due to failure to pay the required renewal premium.

6.

If a general or life insurance policy with a sum assured of Rs. 50000 or less, then it denotes which type of insurance category?
[A]Mortgage Insurance
[B]Micro Insurance
[C]Multi-Peril Insurance
[D]Nonadmitted Insurance

Micro Insurance
A micro-insurance policy is a general or life insurance policy with a sum assured of Rs. 50000 or less.

7.

If a person experience illness, injury, or other physical or psychological impairment, whether temporary or permanent, then it is which type of risk?
[A]Morbidity Risk
[B]Preferred Risk
[C]Morbidity Risk
[D]Standard Risk

Morbidity Risk
Morbidity Risk is the potential for a person to experience illness, injury, or other physical or psychological impairment, whether temporary or permanent. Morbidity risk excludes the potential for an individual’s death, but includes the potential for an illness or injury that results in death.

8.

Which type of life insurance coverage payable to a third party lender upon the death of the insured for loss of loan payments?
[A]Micro Insurance
[B]Mutual Insurance
[C]Mortgage Insurance
[D]Health Insurance

Mortgage Insurance
Mortgage Insurance is a form of life insurance coverage payable to a third party lender/mortgagee upon the death of the insured/mortgagor for loss of loan payments.

9.

What do we call the money charged for the insurance coverage?
[A]Policy Lapse
[B]Morbidity Risk
[C]Premium
[D]Package Policy

Premium
Premium is the money charged for the insurance coverage reflecting expectation of loss.

10.

Under ESIC, Employer contribution rate and Employee contribution rate respectively is –
[A]4.75% & 1.75%
[B]1.75 % & 4.75%
[C]12% & 12%
[D]none

4.75% & 1.75%
Under Employee’s State Insurance Corporation (ESIC) , Employer contributes 4.75% and employee contributes 1.75% .

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