Question

How does the insurance business compare to other participants in the financial sector in terms of vulnerability to money laundering?

a.

It is more vulnerable

b.

It is less vulnerable

c.

It is equally vulnerable

d.

It is immune to money laundering

Answer: (b).It is less vulnerable Explanation:The insurance business is relatively less vulnerable to money laundering compared to other participants in the financial sector, such as banks. While it is not completely immune, certain enabling features of insurance contracts can be misused by money launderers, making it important for insurance companies to implement robust anti-money laundering (AML) measures.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. How does the insurance business compare to other participants in the financial sector in terms of vulnerability to money laundering?

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What are some enabling features of insurance contracts that can be misused for money laundering purposes?

Q. What responsibility do insurance companies have regarding anti-money laundering (AML) programs according to IRDA guidelines?

Q. What is the role of the senior level officer appointed by insurance companies in implementing AML programs?

Q. Why are restrictions placed on acceptance of cash beyond Rs. 50,000 in premium or proposal deposit remittances in the insurance sector?

Q. What is the purpose of setting up Financial Intelligence Units (FIUs) in various jurisdictions?

Q. What is the obligation of financial institutions regarding reporting to the Financial Intelligence Unit in India (FIU-IND)?

Q. How long are records of transactions reported to the FIU required to be retained by insurance companies?

Q. What are the record-keeping requirements for customer identification data according to AML guidelines?

Q. Why is it important for insurance companies to have adequate screening procedures when hiring employees and agents?

Q. What is the role of employees and agents in effective compliance with Anti-Money Laundering (AML) and Counter Financing of Terrorism (CFT) programs?

Q. Why is it important for employees and agents to be properly trained on AML/CFT?

Q. How are premiums typically collected by insurance companies in India?

Q. What is premium in the context of insurance?

Q. When is the premium typically paid by the insured?

Q. What factors generally influence the insurance premium?

Q. According to IRDA regulations, what are the approved methods for premium payment?

Q. According to Section 64 VB of the Insurance Act, when does the risk on the part of the insurer begin?

Q. What happens if the premium is not realized by the insurer for a general insurance policy?

Q. How is the treatment of non-realization of premium different for life insurance policies compared to general insurance policies?

Q. What does Section 64 VB of the Insurance Act specify regarding assumption of risk by insurers?

Recommended Subjects

Are you eager to expand your knowledge beyond IC 14 Regulations of Insurance Business? We've handpicked a range of related categories that you might find intriguing.

Click on the categories below to discover a wealth of MCQs and enrich your understanding of various subjects. Happy exploring!