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 9 of 20

Discover more Topics under IC 14 Regulations of Insurance Business

Q81.
How long is a TPA required to maintain proper records, documents, evidence, and books of all transactions carried out on behalf of an insurance company?

a.

One year

b.

Two years

c.

Three years

d.

Five years

Discuss
Answer: (c).Three years Explanation:A TPA shall maintain proper records, documents, evidence, and books of all transactions carried out by it on behalf of an insurance company in accordance with accepted professional standards of record-keeping and for a period of not less than three years.
Q82.
What is the obligation of a TPA if its license is revoked or cancelled?

a.

Keep the data confidential

b.

Transfer the data to another TPA

c.

Hand over the data and all books, records, or documents relating to the business to the respective insurance company

d.

Destroy all records immediately

Discuss
Answer: (c).Hand over the data and all books, records, or documents relating to the business to the respective insurance company Explanation:If the license granted to the TPA is either revoked or cancelled, the TPA shall hand over the data collected by it and all the books, records, or documents relating to the business carried on by it with regard to an insurance company to that insurance company forthwith, complete in all respects.
Q83.
What reports is a TPA required to furnish to the insurance company and the IRDA?

a.

Bi-annual report

b.

Quarterly report

c.

Monthly report

d.

Annual report and any other return required by the Authority

Discuss
Answer: (d).Annual report and any other return required by the Authority Explanation:Every TPA shall furnish to the insurance company and the IRDA an annual report and any other return as may be required by the Authority on its activities.
Q84.
When should the Annual Report of a TPA be submitted to the IRDA?

a.

Within 30 days of the end of the financial year

b.

Within 45 days of the end of the financial year

c.

Within 60 days of the end of the financial year

d.

Within 90 days of the end of the financial year

Discuss
Answer: (c).Within 60 days of the end of the financial year Explanation:The Annual Report, duly verified by a director of TPA and the Chief Administrative Officer or the Chief Executive Officer shall be submitted within a period of sixty days at the end of its financial year or within such extended time as the Authority may grant.
Q85.
What is the maximum permissible equity participation of a foreign company in an insurance company as per the general registration requirements?

a.

10 percent

b.

15 percent

c.

20 percent

d.

26 percent

Discuss
Answer: (d).26 percent Explanation:The aggregate equity participation of a foreign company (either by itself or through its subsidiary company or its nominees) in the applicant company cannot exceed twenty-six percent of the paid-up capital of the insurance company.
Q86.
How does the Insurance Act and its regulations determine the computation of the twenty-six percent equity participation by a foreign company?

a.

Based on total assets

b.

Based on the market value of shares

c.

Based on the net profit

d.

Based on the paid-up capital

Discuss
Answer: (d).Based on the paid-up capital Explanation:The Insurance Act and the regulations thereunder provide for the manner of computation of the twenty-six percent equity participation, which is based on the paid-up capital of the insurance company.
Q87.
Can an applicant carry on more than one type of insurance business under a single company?

a.

Yes

b.

No

c.

May be Yes or No

d.

Can't say

Discuss
Answer: (b).No Explanation:The applicant can carry on any one of the life insurance business, general insurance business, or reinsurance business. Separate companies would be needed if the intent were to conduct more than one type of business.
Q88.
What specific words are required to be included in the name of the applicant for insurance business registration?

a.

Financial Services

b.

Insurance Solutions

c.

Insurance Company

d.

Risk Management

Discuss
Answer: (c).Insurance Company Explanation:The name of the applicant needs to contain the words "insurance company" or "assurance company" as specified in the general registration requirements.
Q89.
What is the minimum paid-up equity capital required for an applicant seeking to carry on the business of life insurance or general insurance?

a.

Rs. 500 million

b.

Rs. 750 million

c.

Rs. 1 billion

d.

Rs. 1.5 billion

Discuss
Answer: (c).Rs. 1 billion Explanation:The applicant needs to have a minimum paid-up equity capital of Rs. 1 billion in case of carrying on the business of life insurance or general insurance.
Q90.
What is the minimum paid-up equity capital required for an applicant carrying on exclusively the business of reinsurance?

a.

Rs. 1 billion

b.

Rs. 1.5 billion

c.

Rs. 2 billion

d.

Rs. 2.5 billion

Discuss
Answer: (c).Rs. 2 billion Explanation:The applicant carrying on exclusively the business of reinsurance needs to have a minimum paid-up equity capital of Rs. 2 billion.
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