Development of Insurance Legislation in India and Insurance Act 1938 MCQs

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Development of Insurance Legislation in India and Insurance Act 1938 MCQs | Page 2 of 5

Discover more Topics under IC 14 Regulations of Insurance Business

Q11.
How were the companies amalgamated and grouped under GIC?

a.

Through nationalization

b.

By government order

c.

Based on revenue

d.

GIC's choice

Discuss
Answer: (a).Through nationalization Explanation:The companies were amalgamated and grouped under GIC through the process of nationalization.
Q12.
Which of the following is not one of the subsidiary companies of GIC?

a.

National Insurance Company Ltd.

b.

United India Assurance Company Ltd.

c.

Life Insurance Corporation (LIC)

d.

New India Assurance Company Ltd.

Discuss
Answer: (c).Life Insurance Corporation (LIC) Explanation:Life Insurance Corporation (LIC) is not a subsidiary company of GIC.
Q13.
In 1993, which committee was appointed by the Government of India for opening up the insurance sector to private sector participation?

a.

LIC Committee

b.

R. N. Malhotra Committee

c.

GIC Committee

d.

IRDA Committee

Discuss
Answer: (b).R. N. Malhotra Committee Explanation:The R. N. Malhotra Committee was appointed in 1993 for opening up the insurance sector to private participation.
Q14.
When did the IRDA start issuing licenses to private life insurance companies under the Companies Act, 1950?

a.

1994

b.

2000

c.

1956

d.

1993

Discuss
Answer: (b).2000 Explanation:The IRDA started issuing licenses in the year 2000 to private life insurance companies.
Q15.
According to current FDI norms, what is the maximum allowed foreign participation in an Indian insurance company?

a.

50%

b.

26%

c.

75%

d.

100%

Discuss
Answer: (b).26% Explanation:Foreign participation in an Indian insurance company is restricted to 26% under current FDI norms.
Q16.
Which entities are considered members of the Insurance Association of India?

a.

Only insurers incorporated in India

b.

Only insurers domiciled in India

c.

All insurers and provident societies incorporated or domiciled in India

d.

Only insurers incorporated outside India

Discuss
Answer: (c).All insurers and provident societies incorporated or domiciled in India Explanation:All insurers and provident societies incorporated or domiciled in India are members of the Insurance Association of India.
Q17.
How is the membership of insurers and provident societies incorporated or domiciled outside India classified in the Insurance Association?

a.

Full members

b.

Active members

c.

Associate members

d.

Honorary members

Discuss
Answer: (c).Associate members Explanation:Insurers and provident societies incorporated or domiciled outside India are associate members of the Insurance Association.
Q18.
What are the two councils of the Insurance Association?

a.

Legislative Council and Administrative Council

b.

Life Insurance Council and General Insurance Council

c.

Insurance Agents Council and Management Council

d.

Executive Council and Policy Council

Discuss
Answer: (b).Life Insurance Council and General Insurance Council Explanation:The two councils of the Insurance Association are the Life Insurance Council and the General Insurance Council.
Q19.
What function does the Life Insurance Council perform through its Executive Committee?

a.

Setting premium rates

b.

Conducting examinations for insurance agents

c.

Determining claim settlements

d.

Investigating fraud cases

Discuss
Answer: (b).Conducting examinations for insurance agents Explanation:The Life Insurance Council conducts examinations for individuals aspiring to qualify as insurance agents.
Q20.
What is the role of the General Insurance Council's Executive Committee regarding actual expenses of management incurred by an insurer?

a.

Setting limits for premium collection

b.

Determining policy coverage

c.

Fixing limits for exceeding prescribed expenses

d.

Investigating customer complaints

Discuss
Answer: (c).Fixing limits for exceeding prescribed expenses Explanation:The General Insurance Council may fix limits for the actual expenses of management incurred by an insurer, exceeding prescribed limits as per the Insurance Act.
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