Regulations on Conduct of Business MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Regulations on Conduct of Business, 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 Regulations on Conduct of Business 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 Regulations on Conduct of Business mcq questions that explore various aspects of Regulations on Conduct of Business problems. Each MCQ is crafted to challenge your understanding of Regulations on Conduct of Business 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 Regulations on Conduct of Business MCQs are your pathway to success in mastering this essential IC 14 Regulations of Insurance Business topic.

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Regulations on Conduct of Business MCQs | Page 16 of 32

Discover more Topics under IC 14 Regulations of Insurance Business

Q151.
When is the Fund Management Charge (FMC) usually levied?

a.

At the time of policy issuance

b.

At the time of policy maturity

c.

At the time of computation of NAV

d.

At the time of premium payment

Discuss
Answer: (c).At the time of computation of NAV Explanation:The Fund Management Charge (FMC) is typically levied at the time of computation of Net Asset Value (NAV), which is usually done on a daily basis.
Q152.
What does the Policy Administration Charge represent?

a.

Fund management expenses

b.

Fixed charges applied to the premium

c.

Expenses other than those covered by premium allocation charges and fund management expenses

d.

Charges for policy cancellation

Discuss
Answer: (c).Expenses other than those covered by premium allocation charges and fund management expenses Explanation:The Policy Administration Charge represents expenses other than those covered by premium allocation charges and fund management expenses. This charge may be expressed as a fixed amount or a percentage of the premium or sum assured.
Q153.
How is the Surrender Charge calculated?

a.

As a fixed amount deducted from the policy fund

b.

As a percentage of the sum assured

c.

As a percentage of the premium

d.

As a percentage of the fund or as a percentage of the annualized premiums

Discuss
Answer: (d).As a percentage of the fund or as a percentage of the annualized premiums Explanation:The Surrender Charge is usually expressed either as a percentage of the fund or as a percentage of the annualized premiums for regular premium contracts. This charge is levied on the unit fund at the time of surrender of the contract, i.e., pre-mature closure of the policy.
Q154.
What does the Switching Charge refer to?

a.

A charge levied on the premium payment

b.

A charge levied on the sum assured

c.

A charge levied on switching of monies from one fund to another within the product

d.

A charge levied on policy administration

Discuss
Answer: (c).A charge levied on switching of monies from one fund to another within the product Explanation:The Switching Charge is a charge levied on switching (transfer) of monies from one fund to another fund available within the product. This charge is applied at the time of effecting the switch and is typically a flat amount per each switch.
Q155.
What is the Mortality Charge?

a.

The cost of life insurance cover

b.

The charge levied on policy administration

c.

The charge levied on premium allocation

d.

The charge levied on policy cancellation

Discuss
Answer: (a).The cost of life insurance cover Explanation:The Mortality Charge is the cost of life insurance cover. It is exclusive of any expense loadings and may be levied either by cancellation of units or by debiting the premium.
Q156.
When is the Rider Premium Charge levied?

a.

At the time of policy issuance

b.

At the time of premium payment

c.

At the beginning of each policy month from the fund

d.

At the time of policy cancellation

Discuss
Answer: (c).At the beginning of each policy month from the fund Explanation:The Rider Premium Charge is levied at the beginning of each policy month from the fund. This charge covers the cost of rider cover and is exclusive of expense loadings.
Q157.
What does the Partial Withdrawal Charge apply to?

a.

Premium payments

b.

Switching of funds

c.

Part withdrawal of the fund during the contract period

d.

Policy administration

Discuss
Answer: (c).Part withdrawal of the fund during the contract period Explanation:The Partial Withdrawal Charge is a charge levied on the unit fund at the time of part withdrawal of the fund during the contract period. This charge ensures that there are costs associated with withdrawing funds before the policy matures.
Q158.
What does the Miscellaneous charge apply to?

a.

Premium payments

b.

Alterations within the contract

c.

Partial withdrawal of funds

d.

Policy administration

Discuss
Answer: (b).Alterations within the contract Explanation:The Miscellaneous charge is levied for any alterations within the contract, such as an increase in sum assured, premium redirection, or change in policy term. This charge is expressed as a flat amount and is only levied at the time of alteration.
Q159.
What is emphasized regarding the charges other than premium allocation charge and mortality cost?

a.

They have no upper limit

b.

They have an upper limit

c.

They are fixed throughout the policy term

d.

They vary based on market conditions

Discuss
Answer: (b).They have an upper limit Explanation:All the charges other than premium allocation charge and mortality cost shall have an upper limit. This ensures that policyholders are protected from excessive charges.
Q160.
What is the purpose of anti-money laundering guidelines?

a.

To promote illegal activities

b.

To facilitate money laundering

c.

To prevent funds from being routed through illegal channels

d.

To encourage terrorism

Discuss
Answer: (c).To prevent funds from being routed through illegal channels Explanation:The purpose of anti-money laundering guidelines is to prevent funds from being routed through illegal channels for use against public interest. These guidelines aim to safeguard the integrity of the financial system and protect society from economic consequences.
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