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Q 1. How most firms shift their risks?

Buying an insurance policy
Installing smoke alarms
Establishing a safety program
Establishing a self-insurance fund
Stopping the questionable activity

UnAttempted

CORRECT ANSWER:

Buying an insurance policy

Explanation:

The main reason why people buy insurance is for peace of mind (usually the individual) or protection
of a company’s balance sheet (the corporate).

Buying insurance gives a comfort that if something disastrous does happen then the insurance
company will support the insured through the handling and settlement of the claim, so that the affected
individual or company can once again stand on its feet.

Q 2. Identify from the following, the correct option which is used to determine the claim cost
under a fire insurance policy for an insurer.
Surveyor’s cost
Agent’s commission
Distribution cost
Actuary’s professional fees
General administrative expenses

UnAttempted

CORRECT ANSWER:

General administrative expenses

Explanation:

Costs incurred by the insurance firm in processing and administration of insurance claims are called
claims handling cost.

This does not include the actual claim cost or amount of the claim. These costs are associated with
preparing, handling and adjusting claims.

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Q 3. A Consequential Loss Insurance covers _______________________.

Any loss which is not inconsequential
Indemnity for the material damage
Loss of the value of the machinery insured
Loss to uninsured machinery as a consequences of Fire
Loss of Gross Profit and Increased Cost of Working due to stoppage of business arising out of
an insured peril

UnAttempted

CORRECT ANSWER:

Loss of Gross Profit and Increased Cost of Working due to stoppage of business arising out of an
insured peril

Explanation:

The purpose of consequential loss (also known as Loss of Profits i.e. LOP or Business Interruption
Insurance) is, therefore, to make good these losses, namely net profit, standing charges and increased
cost of working.

Q 4. Alpha Ltd. has taken a Public Liability policy with XYZ insurance company for the period
01.01.2015 to 31.12.2015. The policy was renewed further from 01.01.2016 to 31.12.2016.
Identify the period of Insurance for this policy.
01.01.2015 to 31.12.2016
01.01.2016 to 31.12.2016
01.01.2016 to 31.12.2017
01.01.2015 to 31.12.2015
01.01.2015 to 31.12.2017

UnAttempted

CORRECT ANSWER:

01.01.2015 to 31.12.2016

Explanation:

‘Period of Insurance’ means the period commencing from the retroactive date and terminating on the
expiry date as shown in the Policy Schedule.

For example- if the policy period is from 1-1-2010 to 31-12-2010 and the policy renewed from 1-1-2011
to 31-12-2011 then under the renewed policy the retroactive date will be 1-1-2010 which date will
continue in further renewals.

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Q 5. What does a motor insurance policy that is compulsory insurance is called as?
Loss only
Act only
Profit only
Liability only
Insurance only

UnAttempted

CORRECT ANSWER:

Act only

Explanation:

The insurance of motor vehicles against own damage (i.e. damage to the vehicle itself) is not made
compulsory, but the insurance of third party liability arising out of the use of motor vehicles in public
places is made compulsory.

As per this provision of the MV Act no motor vehicle can ply on road or in a public place without such
insurance. Motor insurance policy for such compulsory insurance is called “Act Only” policy.

Q 6. What is the full form of IRDAI?

Insurance Reform & Development Authority of India
Insurance Regulatory & Desired Authority of India
Insurance Research & Development Authority of India
Insurance Regulatory & Development Authority of India
Insurance Regulatory & Development Association of India

UnAttempted

CORRECT ANSWER:

Insurance Regulatory & Development Authority of India

Explanation:

Insurance Regulatory & Development Authority of India (IRDAI) is the Regulatory body established
under the Insurance Regulatory & Development Authority Act, 1999 and reports to Ministry of Finance.

Q 7. Which of the following statement is correct?

The insurance of motor vehicles against third party liability arising out of the use of motor
vehicles in public places is not compulsory
The insurance of motor vehicles against own damage is compulsory
The insurance of motor vehicles against own damage is compulsory, but the insurance of third
party liability arising out of the use of motor vehicles in private places is not compulsory

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The insurance of motor vehicles against own damage is not compulsory, but the insurance of
third party liability arising out of the use of motor vehicles in public places is compulsory
The insurance of motor vehicles against own damage and of third party liability arising out of
the use of motor vehicles in public places is compulsory

UnAttempted

CORRECT ANSWER:

The insurance of motor vehicles against own damage is not compulsory, but the insurance of
third party liability arising out of the use of motor vehicles in public places is compulsory

Explanation:

The insurance of motor vehicles against own damage (i.e. damage to the vehicle itself) is not made
compulsory, but the insurance of third party liability arising out of the use of motor vehicles in public
places is made compulsory.

As per this provision of the MV Act no motor vehicle can ply on road or in a public place without such
insurance. Motor insurance policy for such compulsory insurance is called “Act Only” policy.

Q 8. Identify the insurance which exclusively covers ocean-going steamers and fishing vessels
against such risks as fire and collision, as per the conventional classification of general
insurance.
Fire Insurance
Motor Insurance
Hull Insurance
Health Insurance
Cargo Insurance

UnAttempted

CORRECT ANSWER:

Hull Insurance

Explanation:

As per the conventional classification of general insurance, Hull insurance relates to the insurance of
oceangoing steamers, motor launches, fishing vessels etc., against such risks as fire, collision, storm,
stranding, etc.

Q 9. What would be the premium charged for Glass & ceramic factories, as per comprehensive
general insurance policies.
Highest
Lowest
Average

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Premium greater than charged for Sugar industries

Premium greater than charged for Distilleries

UnAttempted

CORRECT ANSWER:

Lowest

Explanation:

Risks are categorised into 4 groups de pending upon the hazard factors involved.

Some examples are:

Group I: Biscuit factories, Coir factories, Glass & Ceramic factories, Silk factories etc.
Group II: Breweries, Cigarette factories, Shoe factories, Sugar factories etc.
Group III: Distilleries, Manmade yarn / fibre manufacturing, paper and cardboard mills.
Group IV: Celluloid goods manufacturing, Fertilizer manufacturing, Match factories, etc.

* The rates are the lowest for Group I risks and increase scale for the other groups.

Therefore, for Glass and Ceramic factories the premium charged is the lowest.

Q 10. Identify the legislations which does not provide for Statutory Liability covered by an
insurance policy.
Indian Stamps Act
Fatal Accident Act
Motor Vehicle Act
Employees Compensation Act
Public Liability Insurance Act

UnAttempted

CORRECT ANSWER:

Indian Stamps Act

Explanation:

The Indian Stamp Act of 1899 is an in-force Act of the Government of India for the charging of stamp
duty on instruments recording transactions.

Other acts mentioned here provide for indemnity to the insured owner against the statutory liability
arising out of accidents occurring during the currency of the policy.

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Q 11. ________________ is an Insurance property under the Machinery Breakdown Policy.

Boiler
Vessel
Aircraft
Laptop
LED Light

UnAttempted

CORRECT ANSWER:

Boiler

Explanation:

Insurable property under Machinery Breakdown (Also known as Machinery Insurance) Policy are
boilers, electrical, mechanical machinery and equipment. The policy covers unforeseen and sudden
physical damage by any cause (subject to excepted risks) to the insured property, in short mechanical
and electrical breakdowns, under following situation:

While it is at work or at rest.

While being dismantled for cleaning or overhauling.
During cleaning or overhauling operations.
When being shifted within the premises.
During subsequent erection.

Q 12. Which of the following is correct option in context to a Hire Purchase agreement?
Policies have to be issued in the name of the registered owner only
Policies must be issued in the name of the hired only
Policies must be issued in the name of the hirer only
Policies must be issued in the name of the hirer and the owner’s interest protected by
attaching to the policy the prescribed endorsement
Policies must be issued in the name of the hirer and the owner’s interest may not be protected
by attaching to the policy

UnAttempted

CORRECT ANSWER:

Policies must be issued in the name of the hirer and the owner’s interest protected by attaching
to the policy the prescribed endorsement

Explanation:

In the case of hire purchase agreements, policies must be issued in the name of the hirer and the
owner’s interest protected by attaching to the policy the prescribed endorsement.

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Q 13. Identify the correct option from the following with respect to Loss or damage to the
vehicle and Third Party Liability (TPL.
Losses in a motor vehicle policy
Damages in a motor vehicle policy
Interest in a motor vehicle policy
Repairs in a motor vehicle policy
Premium on motor vehicle policy

UnAttempted

CORRECT ANSWER:

Losses in a motor vehicle policy

Explanation:

Two types of losses arise in respect of motor vehicles of all categories. They are:

Loss of or damage to the vehicle (Own Damage or OD) and

Third Party Liability (TPL) i.e. the legal liability for property damage and /or personal injury to third
parties, arising out of use of the motor vehicle.

Q 14. _____________ is not considered as an example of express conditions.

Reasonable care
Alteration to the risk
Contribution
Claim procedure
Insurable interest

UnAttempted

CORRECT ANSWER:

Insurable interest

Explanation:

Express Conditions are specifically stated as opposed to implied conditions. Below mentioned are the
examples of Express conditions:

Terms
Alteration to the risk
Claims procedure
Fraud
Reasonable Care

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Contribution
Cancellation
Estimates/Declarations

Q 15. M/s Tripexpert is a rental car service in India. Mr. Prasad rented a Honda City from them
for his trip to Mahabaleshwar. Suggest about who will bear the motor vehicle insurance
cost.
Honda
M/s Tripexpert
Both Mr. Prasad & M/s Tripexpert
Mr. Prasad
Neither Mr. Prasad nor M/s Tripexpert

UnAttempted

CORRECT ANSWER:

M/s Tripexpert

Explanation:

Having a car insurance policy is a statutory requirement by the law. If it is a rental car, then the rental
company would have already insured the car. However, while traveling, if any damage has been caused
to the rental car, the repair costs will be covered by the insurance company.

If the damage caused to the car is due to careless driving, the repair costs will have to be borne by the
person who has rented it.

Q 16. Which of the following policy is designed to provide a basic minimum cover at a
reasonable premium allowing the purchase of insurance by a majority of people?
Special Contingence
Specialized Insurance Policy
Customized Insurance Policy
Unique Insurance Policy
Standard Insurance Policy

UnAttempted

CORRECT ANSWER:

Standard Insurance Policy

Explanation:

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Standard insurance policies are designed to provide a basic minimum cover at a reasonable premium,
to make possible the purchase of insurance by the majority of people.

Q 17. Jagdish has a property valued at Rs. 4 Lac which he has insured with AAA Insurance for
Rs. 6 Lac and with XXX Insurance for Rs. 10 Lac. Both the policies have contribution
clause. How much will XXX insurance pay if a fire totally destroyed property?
Rs.10 Lac
Rs.1.5 Lac
Rs.2.5 Lac
Rs.6 Lac
Rs.4 Lac

UnAttempted

CORRECT ANSWER:

Rs.2.5 Lac

Explanation:

The compensation payable when a covered loss or damage occurs shall be based on whether or not
the property has been insured adequately. If the amount insured is excessive, claim amount will be in
proportion to the market value only.

In the above scenario, the claim will be settled on the destroyed property value (Rs. 4 Lac) and it will be
shared in proportion to the insured value between both the insurers.

The sharing proportion between AAA insurance and XXX insurance is 3 :5 as given. Property Value is 4
Lacs which will be divided in the ratio of 3:5.

Therefore, AAA will pay Rs. 150000/- and XXX will pay Rs. 250000/-

Q 18. Identify the risk management process components which refer to estimating the likely
probability of a risk occurrence & its likely severity.
Identification
Financing
Evaluation
Transfer
Prevention & Control

UnAttempted

CORRECT ANSWER:

Identification

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Explanation:

Risk identification is all about identifying the business’ exposure to uncertainty. This is best done by a
team because each member will see the risk in a different light.

The risk team needs to examine the company intimately both in terms of external and internal
exposures, the market in which it operates, the legal, social, political and cultural environment in which
it exists and an in-depth knowledge of how it operates.

Q 19. Give an example of insurance of property.

Fidelity guarantee insurance
Products liability insurance
Cattle Insurance
Public (third party) liability insurance
Personal accident and sickness insurance

UnAttempted

CORRECT ANSWER:

Cattle Insurance

Explanation:

In recent times, general insurance is classified differently under Insurances of property, Insurances of
persons, Insurances of interest and Insurances of liability.

Fire insurance, marine insurance, burglary insurance, engineering insurance, motor vehicle insurance,
aviation hull insurance, crop insurance and cattle insurance are important classes of insurance falling
under the classification of Insurances of property.

Q 20. Identify the correct option from the following which may not be covered in a professional
indemnities policy.
Executive Director
Architect
Doctor
Chartered Accountant
Lawyer

UnAttempted

CORRECT ANSWER:

Executive Director

Explanation:
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Professional indemnities are designed to provide insurance protection to professionals such as

doctors, solicitors, chartered accountants, and architects etc. against their legal liability to pay
damages arising out of negligence in performance of their professional duties. Such professionals can
be:

doctors / medical practitioners; medical establishments; engineers, architects and interior decorators;
chartered accountants, financial consultants, management consultants, and lawyers, advocates,
solicitors and counsel.

Q 21. Fill up the correct option in the following statement. ‘The Public Liability Insurance Act of
1991 requires that any undertaking which handles hazardous substances, has to
compulsorily insure liability for an amount less than the amount of the ____________ of
the undertaking.’
Issued capital
Paid up capital
Unpaid capital
Authorised capital
Subscribed capital

UnAttempted

CORRECT ANSWER:

Paid up capital

Explanation:

The Public Liability Insurance Act, 1991 requires that any undertaking which handles hazardous
substances, has to compulsorily insure liability for an amount not less than the amount of the paid up
capital of the undertaking.

If it is not a company, paid up capital means the market value of all assets and stocks of the
undertaking on the date of contract of insurance.

Q 22. Explain the prerequisites to get fixed relief for an accident victim in a case of temporary
partial disablement under the public liability insurance Act 1991.
Victim has been hospitalized a period exceeding 1 days and is above 5 years of age
Victim has been hospitalized a period exceeding 3 days and is above 14 years of age
Victim has been hospitalized a period exceeding 1 days and is above 14 years of age
Victim has been hospitalized a period exceeding 1 days and is above 16 years of age
Victim has been hospitalized a period exceeding 3 days and is above 16 years of age

UnAttempted

CORRECT ANSWER:
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Victim has been hospitalized a period exceeding 3 days and is above 16 years of age

Explanation:

The Public Liability Insurance Act 1991 prescribes under Section 3 the amount of relief payable is as
per the following schedule:

Fatal Accident – Rs.25,000/- per person

Permanent Total disability - Rs.25,000/- per person
Permanent Partial disability: The amount of relief is based on the percentage of disablement
certified by an authorised physician i.e., a registered medical practitioner.
Temporary partial disablement which reduces the earning capacity of the victim: Fixed relief not
exceeding Rs.1,000/- per month upto a maximum of 3 months (provided the victim has been
hospitalised for a period exceeding 3 days and is above 16 years of age).
Actual Medical Expenses: Upto a maximum of Rs.12,500 in each case under (i) to (iv) above.
Actual damage to property upto Rs.6,000/-.

Q 23. ______________is not a prerequisite to get License for a Surveyor from IRDAI.
Age
Gender
Relevant Insurance Training
Relevant Experience
Professional Qualification

UnAttempted

CORRECT ANSWER:

Gender

Explanation:

Under the IRDAI, both individuals and corporates can apply for becoming an Insurance Surveyor and
Loss Assessor. For an individual, there are particular requirements to be fulfilled. An individual should
become a member of the IRDAI to get a valid license.

A student member is an individual registering as a trainee to secure the licence. Fellow member is an
individual holding membership for eight years, and an associate member is an individual holding
membership for 16 years. A company can be a surveyor and loss assessor.

Q 24. What is the per person amount of relief payable for a fatal accident, according to The
Public Liability Insurance Act of 1991?
Rs. 1,00,000/-
Rs. 150,000/
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Rs. 25,000/-
Rs. 75,000/-
Rs. 50,000/-

UnAttempted

CORRECT ANSWER:

Rs. 25,000/-

Explanation:

The Public Liability Insurance Act, 1991 requires that any undertaking which handles hazardous
substances, has to compulsorily insure liability for an amount not less than the amount of the paid up
capital of the undertaking. If it is not a company, paid up capital means the market value of all assets
and stocks of theundertaking on the date of contract of insurance.

The Act prescribes under Section 3 the amount of relief payable for Fatal Accident is Rs.25,000/- per
person

Q 25. Which of the following is earmarked for eventual claim payment?

Equity Reserve
IBNR Reserve
Claims Reserve
Premium Reserve
Insurance Reserve

UnAttempted

CORRECT ANSWER:

Claims Reserve

Explanation:

A claims reserve is a reserve of money that is set aside by an insurance company in order to pay
policyholders who have filed or are expected to file legitimate claims on their policies. Insurers use the
fund to pay out incurred claims that have yet to be settled.

Q 26. The insurer is not liable for any loss after the expiry of ____________ from the date of loss
unless the claim is the subject of pending action or arbitration.
12 months
3 months

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1 months
6 months
9 months

UnAttempted

CORRECT ANSWER:

12 months

Explanation:

The insurer is not liable for any loss after the expiry of 12 months from the date of loss unless the
claim is the subject of pending action or arbitration.

If liability is disclaimed by the insurer and the insured has not filed a suit in a court of law, within 12
months of the date of disclaimer, the claim is deemed to have been abandoned by the insured. It is not
recoverable thereafter.

Q 27. Name the General Insurance Company which is not specialised insurer in India.
Apollo Munich Insurance
The New India Assurance Co. Ltd.
Export Credit Guarantee of India (ECGC)
General Insurance Corporation of India
Agriculture Insurance Company of India (AIC)

UnAttempted

CORRECT ANSWER:

Apollo Munich Insurance

Q 28. __________ line of business is concerned with piracy attack.

Marine
Fire
Motor
Engineering
Business Interruption

UnAttempted

CORRECT ANSWER:

Marine

Explanation:

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Piracy is an act of robbery or criminal violence by ship or boat-borne attackers upon another ship or a
coastal area, typically with the goal of stealing cargo and other valuable goods.

Q 29. Complete the following statement: ‘A breach of warranty will make the policy
____________.’
Illegal
Void
Voidable
Enforceable
Acceptance

UnAttempted

CORRECT ANSWER:

Voidable

Explanation:

A warranty requires an insured to do, or not do, certain things and is often linked to a specific trade. A
breach would make the policy voidable.

Warranties may arise out of the survey report and are intended to deal with a particular hazard e.g.
daily removal of waste products. Others may be a matter of common sense e.g. sprinklers to be
regularly tested.

Q 30. __________ is recognised as income over the contract period in the insurer’s book of
accounts.
Claims
Premium
Bonuses
Loans
Broker’s commission

UnAttempted

CORRECT ANSWER:

Premium

Explanation:

Premium is to be recognised as income over the contract period or the period of risk. Premium
received in advance not relating to the current accounting period to be disclosed separately under the
head “Current Liabilities”.

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Premium reserve for unexpired risks has to be created.

Q 31. What is the method to calculate Pure Premium.

Number of Units of Exposure / Number of Claims
Total Amount of Incurred Losses / Number of Claims
Number of Claims / Number of Units of Exposure
Total Amount of Incurred Losses/Number of Units of Exposure
Number of Units of Exposure / Total Amount of Incurred Losses

UnAttempted

CORRECT ANSWER:

Total Amount of Incurred Losses/Number of Units of Exposure

Explanation:

Pure premium rating method reflects the expected losses. It is a calculation of the pure cost of, say,
property or liability insurance protection. This is without any loading for the insurance company's
expenses, premium taxes, contingencies and profit margins.

The pure premium is calculated as follows:

Pure Premium = Total Amount of Losses Incurred per Year / Number of Units of Exposure

Q 32. Identify the common feature between the householder’s and shopkeeper’s insurance
policy.
Cover under Fire section is compulsory
Cover under Marine section is compulsory
Cover under Fire section is not compulsory
Cover under Marine section is not compulsory
Cover under Fire as well as Marine section are compulsory

UnAttempted

CORRECT ANSWER:

Cover under Fire section is compulsory

Explanation:

Householder’s Insurance and Shopkeeper’s Insurance protects the respective insured by combining
under a single policy a number of contingencies which are otherwise covered under separate policies.

Under both the above policies, cover under fire section is compulsory. The insured can choose any of
the remaining covers.
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Q 33. ____________________ covers the wages in direct transit from the bank to the insured
premises.
Money Insurance Policy
Burglary Insurance Policy
Baggage Insurance Policy
All Risk Insurance Policy
Fidelity Guarantees Insurance Policy

UnAttempted

CORRECT ANSWER:

Money Insurance Policy

Explanation:

The property covered under Money insurance policy is:

a. Wages in direct transit from the bank to the insured premises.

b. Money other than under (a) above, in transit to and from insured premises / bank / post office /
any other specified premises.
c. Money other than under (a) and (b) above, collected by the insured’s employees and in transit to
the premises or bank.
d. Any other transit as may be specified.

Q 34. In private motor insurance, separate rates apply for vehicles below and above ______ .
800 cc
1000 cc
1500 cc
1800 cc
2000 cc

UnAttempted

CORRECT ANSWER:

1500 cc

Q 35. If Mr. Abhay's car collides with another car and the other car's driver gets injured, who will
pay for the claims of the other driver ?
Mr. Abhay will have to pay
The other driver if if in uninsured
Third party insurance pool
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Mr. Abhay's insurance company

The other drivers insurance company

UnAttempted

CORRECT ANSWER:

Third party insurance pool

Explanation:

The claims of the other driver will be paid from the Third Party Insurance pool.

Q 36. Which of the following is not likely to be a rating factor in Fire Insurance ?
Security of the building
Fire Extinguishers
Deductible
Construction
None of the above

UnAttempted

CORRECT ANSWER:

Security of the building

Explanation:

Building security can be considered as a rating factor for burglary insurance but not fire insurance.

Q 37. Pure Premium is defined as ________ .

Total premium divided by the number of exposure units
Total premium divided by the total claims
Total amount of claims divided by premium
Total amount of claims incurred per year divided by the number of exposure units
None of the above

UnAttempted

CORRECT ANSWER:

Total amount of claims incurred per year divided by the number of exposure units

Q 38. __________ cannot be an intermediary.

Bank

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Insurer
Agent
Insurance Broker
All of the above

UnAttempted

CORRECT ANSWER:

Insurer

Explanation:

Insurance companies are Principals who appoint intermediaries etc.

Q 39. To process a motor insurance claim which of these document(s) is/are required ?
Driving Licence
Police Report
Registration Certificate Book
All of the above
None of the above

UnAttempted

CORRECT ANSWER:

All of the above

Q 40. Which of these future trends the underwriter need not consider while calculating the
technical pricing ?
Legal changes
Inflation
Claims made during the year
Technology
All of the above

UnAttempted

CORRECT ANSWER:

Claims made during the year

Explanation:

The claims will certainly be considered by the underwriter but not under the heading of future trends.

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Q 41. In which two ways can risk be measured within a risk register ?
Probability and Transferability
Probability and Severity
Probability and Financial
Probability and Ownership
Probability and Assurance

UnAttempted

CORRECT ANSWER:

Probability and Severity

Explanation:

Risk must be examined carefully, identified and measured in terms of following factors :

1. Frequency of its likely occurance

2. Probability of loss / damage

3. Severity of the effects of a loss

4. Perception of the probability of loss

Q 42. Which policy covers damage to actual structure of the vessel ?

Marine Hull insurance
Marine Cargo insurance
Marine Fire insurance
All of the above
None of the above

UnAttempted

CORRECT ANSWER:

Marine Hull insurance

Explanation:

Marine Hull insurance covers damage to actual structure of the vessel.

Q 43. In case of Motor Insurance which document is considered as the only evidence of
existence of a valid insurance by police authorities and RTO ?
Insurance Notice Document
Cover Notice
Policy Document

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Certificate of Insurance
Any of the above

UnAttempted

CORRECT ANSWER:

Certificate of Insurance

Q 44. How are the limits of liability of a ship owner for loss of or damage to cargo calculated ?
In terms of returns
In risk terms
In usage terms
In profitable terms
In monetary terms

UnAttempted

CORRECT ANSWER:

In monetary terms

Q 45. What is the limit of amount deductible under 0.6% franchise clause when sum insured is
1000000 ?
Rs. 1000000
Rs. 26000
Rs. 6000
Rs. 3000
Rs. 600

UnAttempted

CORRECT ANSWER:

Rs. 6000

Explanation:

It is a clause stipulating that the insured will be responsible for any loss not in excess of a stated
amount, and the insurance company will be liable for full payment of the loss equaling or exceeding
the amount up to the insured amount.

Therefore 1000000 x 0.6% = 6000

Q 46. As per the Insurance Act, the __________ may, by rules, relax the requirements in respect
of advance payment of premium.
IRDAI

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Central Government
State Government
SEBI
Any legal body

UnAttempted

CORRECT ANSWER:

Central Government

Explanation:

As per Sec 64 VB, Subsection 1 - No insurer shall assume any risk in India in respect of any insurance
business on which premium is not paid etc..

However, The Central Government may, by rules , relax the requirements of sub-section 1 in respect of
particular categories in insurance policies.

Q 47. The full form of ILU is __________ .

Institute of London Ultrasounds
Institute of London Unified
Institute of London Undertakers
Institute of London Universities
Institute of London Underwriters

UnAttempted

CORRECT ANSWER:

Institute of London Underwriters

Q 48. __________ covers operational loss to engines, air compressors, pumps etc.
ALOP Policy
Boiler insurance
Hull insurance
Contractors All Risk insurance
Machinery breakdown insurance

UnAttempted

CORRECT ANSWER:

Machinery breakdown insurance

Explanation:

Insurable property under the Machinery Breakdown policy are boilers, electrical, mechanical
machinery and equipment.
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Q 49. Which are the two categories in which partial losses in marine insurance can be classified
?
Actual average and General average
Particular average and standard average
Average average and General average
Particular average and General average
Consistent average and General average

UnAttempted

CORRECT ANSWER:

Particular average and General average

Explanation:

Partial losses can be classified as Particular Average and General Average.

Particular Average are partial losses - for eg. 20 packets out of 100 in a consignment are damaged.

General Average loss is when an extraordinary sacrifice or expenditure is made - for eg. Cargo is
jettisoned in an effort to refloat the ship.

Q 50. For what is the 'Premium Register Copy' must for ?

Underwriting premium
Underwriting loans
Underwriting services
Underwriting balance sheet
Underwriting returns

UnAttempted

CORRECT ANSWER:

Underwriting returns

Explanation:

The primary business of an insurance company is generating premium income & paying claims.
Payment of claims is the prime reason why the insurers are in business. Underwriting returns are
computed on the basis of premium register.

Out of 50 questions 50 are un attempted.

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