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 17 of 32

Discover more Topics under IC 14 Regulations of Insurance Business

Q161.
Which is not a negotiable instrument?

a.

Debit card

b.

Demand draft

c.

Pay order

d.

Cheque

Discuss
Answer: (a).Debit card Explanation:A debit card is not a negotiable instrument; it functions as an electronic payment method but lacks the negotiability and transferability of traditional negotiable instruments.
Q162.
In simple terms, what does ‘a void ab initio policy’ mean?

a.

Policy exists

b.

Policy does not exist

c.

Risk of the insurer is deferred

d.

Risk of the insurer commences

Discuss
Answer: (b).Policy does not exist Explanation:A "void ab initio policy" means the policy is deemed nonexistent from the beginning, usually due to some fundamental flaw or legal violation.
Q163.
What were the significant changes introduced by IRDA after the government intervention in 2010?

a.

ULIPs were completely abolished

b.

The cost structure of ULIPs was increased

c.

ULIPs were made more investor-friendly, with a major overhaul of their cost structure

d.

ULIPs were limited to only certain insurance companies

Discuss
Answer: (c).ULIPs were made more investor-friendly, with a major overhaul of their cost structure Explanation:After the government intervention, IRDA passed new guidelines resulting in a major overhaul of ULIPs, making them more investor-friendly by reducing the cost structure.
Q164.
What does a Unit represent in a Unit Linked Insurance Policy (ULIP)?

a.

A component of the fund in a ULIP

b.

A measure of the policyholder's life cover

c.

A fixed premium amount in a ULIP

d.

A regulatory body overseeing ULIP operations

Discuss
Answer: (a).A component of the fund in a ULIP Explanation:In a ULIP, a Unit is a component of the fund, and the policyholder's investment in the fund is denoted in the form of units.
Q165.
What is the primary factor determining the returns from a Unit Linked Insurance Plan (ULIP)?

a.

The premium amount paid by the policyholder

b.

The policyholder's age and health condition

c.

The performance of the fund in which the ULIP is invested

d.

The insurance company's profit margin

Discuss
Answer: (c).The performance of the fund in which the ULIP is invested Explanation:The returns from a ULIP are dependent upon the performance of the fund in which it is invested.
Q166.
What option does a policyholder have regarding investment in ULIP funds?

a.

They can only invest in a single fund throughout the policy term

b.

They cannot switch or redirect their investments once made

c.

They have the option to invest in more than one fund (redirection) and can switch between funds

d.

They can only invest in equity funds

Discuss
Answer: (c).They have the option to invest in more than one fund (redirection) and can switch between funds Explanation:A ULIP policyholder has the option to invest in more than one fund (redirection) and can switch or change existing investments from one fund to another.
Q167.
What does the term "redirection" refer to in the context of ULIPs?

a.

Shifting the fund corpus to a different insurer

b.

Investing in a conservative fund

c.

The policyholder's option to invest in more than one fund

d.

The policyholder's choice to switch between debt and equity funds

Discuss
Answer: (c).The policyholder's option to invest in more than one fund Explanation:"Redirection" in the context of ULIPs refers to the policyholder's option to invest in more than one fund.
Q168.
What types of funds are typically offered under ULIP schemes by insurance companies?

a.

Only equity funds

b.

Conservative fund, balance fund, and aggressive fund

c.

Mutual funds and fixed deposits

d.

Debt securities and government bonds

Discuss
Answer: (b).Conservative fund, balance fund, and aggressive fund Explanation:Insurance companies typically offer conservative fund, balance fund, and aggressive fund under ULIP schemes.
Q169.
Which regulatory authority governs ULIPs?

a.

Securities and Exchange Board of India (SEBI)

b.

Reserve Bank of India (RBI)

c.

Insurance Regulatory and Development Authority (IRDA)

d.

Ministry of Finance

Discuss
Answer: (c).Insurance Regulatory and Development Authority (IRDA) Explanation:ULIP is an insurance product and is governed by the Insurance Regulatory and Development Authority (IRDA), not by SEBI.
Q170.
What is the revised lock-in period for all Unit Linked Products according to the IRDA guidelines effective from September 2010?

a.

Three years

b.

Four years

c.

Five years

d.

Six years

Discuss
Answer: (c).Five years Explanation:The three-year lock-in period for all Unit Linked Products was increased to a period of five years, including top-up premiums.
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