IRDA and its Licensing Functions MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on IRDA and its Licensing Functions, a fundamental topic in the field of IC 14 Regulations of Insurance Business. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our IRDA and its Licensing Functions MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of IRDA and its Licensing Functions mcq questions that explore various aspects of IRDA and its Licensing Functions problems. Each MCQ is crafted to challenge your understanding of IRDA and its Licensing Functions principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC 14 Regulations of Insurance Business tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our IRDA and its Licensing Functions MCQs are your pathway to success in mastering this essential IC 14 Regulations of Insurance Business topic.

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IRDA and its Licensing Functions MCQs | Page 15 of 20

Discover more Topics under IC 14 Regulations of Insurance Business

Q141.
What is the requirement for insurers regarding outstanding claims provisions under the IRDA (General Insurance – Reinsurance Regulations) 2000?

a.

Insurers are not required to make outstanding claims provisions.

b.

Provisions are only required for reinsurance arrangements received from Brokers.

c.

Provisions are required for every reinsurance arrangement, either based on loss information advices or actuarial estimation.

d.

Provisions are only required for reinsurance arrangements where loss information advices are not received.

Discuss
Answer: (c).Provisions are required for every reinsurance arrangement, either based on loss information advices or actuarial estimation. Explanation:Every insurer is required to make outstanding claims provisions for every reinsurance arrangement accepted, either based on loss information advices received from Brokers / Cedants or, where such advices are not received, on an actuarial estimation basis. Additionally, an appropriate provision for incurred but not reported claims on the reinsurance accepted portfolio is required on an actuarial estimation basis.
Q142.
Before being notified as a National Reinsurer, what role did General Insurance Corporation of India (GIC) play in the Indian insurance market?

a.

GIC was a direct insurer, underwriting various types of insurance.

b.

GIC operated as a holding/parent company of four public sector general insurance companies.

c.

GIC exclusively focused on crop insurance.

d.

GIC served as a regulatory body for the insurance industry.

Discuss
Answer: (b).GIC operated as a holding/parent company of four public sector general insurance companies. Explanation:Before being notified as a National Reinsurer, GIC was operating as a holding/parent company of the four public sector general insurance companies, and it controlled their reinsurance programmes.
Q143.
What is the role of GIC (General Insurance Corporation of India) after deregulation in the insurance market?

a.

GIC continues to underwrite various types of insurance directly.

b.

GIC solely manages Hull Pool on behalf of the market.

c.

GIC divested itself of any direct business and focuses on reinsurance.

d.

GIC primarily manages the Terrorism Pool.

Discuss
Answer: (c).GIC divested itself of any direct business and focuses on reinsurance. Explanation:After deregulation, GIC has assumed the role of the market’s only professional re-insurer. It divested itself of any direct business that it wrote prior to November 2000, with the temporary exception of crop insurance. GIC currently focuses on reinsurance, both in India and through its overseas offices and trading partners.
Q144.
What does GIC (General Insurance Corporation of India) manage on behalf of the market?

a.

Crop insurance.

b.

Terrorism Pool.

c.

Hull Pool.

d.

Both b and c.

Discuss
Answer: (d).Both b and c. Explanation:GIC currently manages Hull Pool on behalf of the market, which receives a cession from writing companies, and it also manages the Terrorism Pool.
Q145.
What guidelines are mentioned for brokers regarding the placement of Facultative Reinsurance and Treaty or Excess of Loss Reinsurance?

a.

Guidelines are not provided for brokers.

b.

Brokers must use reinsurers rated A or higher by a recognized credit rating agent.

c.

Brokers must not use reinsurers rated BBB or higher.

d.

Brokers are not involved in the placement of reinsurance.

Discuss
Answer: (b).Brokers must use reinsurers rated A or higher by a recognized credit rating agent. Explanation:Brokers must be mindful of using only such reinsurers who are rated BBB or higher by a recognized credit rating agent, as required by Regulation 3(7) of IRDA (General Insurance – Reinsurance) Regulations 2000.
Q146.
What is the primary role of surveyors in the insurance claim settlement process?

a.

To underwrite insurance policies.

b.

To investigate fraudulent claims.

c.

To assess the loss or damage and act as a link between the insurer and the insured.

d.

To sell insurance policies to potential customers.

Discuss
Answer: (c).To assess the loss or damage and act as a link between the insurer and the insured. Explanation:Surveyors play a crucial role in the insurance claim settlement process by assessing the actual loss or damage and serving as a link between the insurer and the insured.
Q147.
What is the relationship between surveyors and insurance companies?

a.

Employees.

b.

Independent professionals.

c.

Agents.

d.

Policyholders.

Discuss
Answer: (b).Independent professionals. Explanation:Surveyors, like agents, are not employees but are independent professionals hired by the insurance company to assess loss or damage and ensure the accuracy of claims.
Q148.
What is the licensing procedure for individuals intending to act as surveyors and loss assessors in general insurance business?

a.

Licensing is not required for surveyors.

b.

Applicants must submit an application and undergo practical training for up to 12 months.

c.

The licensing procedure is governed by the Controller of Insurance.

d.

Licenses are automatically granted without an application process.

Discuss
Answer: (b).Applicants must submit an application and undergo practical training for up to 12 months. Explanation:Individuals intending to act as surveyors and loss assessors in general insurance business need to apply to the IRDA for a license. The licensing procedure involves submitting an application, undergoing practical training for a period not exceeding 12 months, and meeting specified technical qualifications.
Q149.
How long is a surveyor's license valid from the date of issue, unless cancelled earlier?

a.

One year.

b.

Three years.

c.

Five years.

d.

Ten years.

Discuss
Answer: (c).Five years. Explanation:A surveyor's license remains valid for a period of five years from the date of issue unless cancelled earlier by the IRDA.
Q150.
If a surveyor's license has been cancelled or suspended, when can the individual submit a new application for issuance of a license?

a.

After six months.

b.

After one year.

c.

After three years.

d.

After five years.

Discuss
Answer: (c).After three years. Explanation:If a surveyor's license has been cancelled or suspended, the individual may submit a new application for issuance of a license after the expiry of three years from the date of such cancellation or suspension.
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