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 24 of 32

Discover more Topics under IC 14 Regulations of Insurance Business

Q231.
What does the facility of top-up premiums allow for policyholders in Unit Linked Policies?

a.

It allows them to decrease their annual contributions.

b.

It allows them to avoid initial allocation charges.

c.

It allows them to withdraw a portion of their funds.

d.

It allows them to surrender their policies.

Discuss
Answer: (b).It allows them to avoid initial allocation charges. Explanation:The facility of top-up premiums allows policyholders to increase their annual contributions, avoiding initial allocation charges.
Q232.
What is the maximum loan amount that can be sanctioned under any ULIP policy?

a.

30% of the surrender value

b.

40% of the surrender value in products with equity over 60%

c.

50% of the surrender value in products with debt over 60%

d.

60% of the surrender value

Discuss
Answer: (b).40% of the surrender value in products with equity over 60% Explanation:The maximum loan amount that can be sanctioned under any ULIP policy is 40% of the surrender value in products where equity accounts for more than 60% of the total share.
Q233.
How should insurers distribute the overall charges in ULIPs during the lock-in period?

a.

Unevenly

b.

In favor of equity funds

c.

In favor of debt instruments

d.

Evenly

Discuss
Answer: (d).Evenly Explanation:Insurers shall distribute the overall charges in ULIPs evenly during the lock-in period.
Q234.
What is a settlement option in the context of insurance policies?

a.

Option to settle claims at a future date after maturity

b.

Option to receive claims immediately upon maturity

c.

Option to surrender the policy for a cash value

d.

Option to switch between different funds

Discuss
Answer: (a).Option to settle claims at a future date after maturity Explanation:Settlement option in insurance policies refers to the option to receive claims at a future date after maturity.
Q235.
For how long after the date of maturity can policyholders exercise the settlement option in ULIPs?

a.

1 year

b.

3 years

c.

5 years

d.

10 years

Discuss
Answer: (c).5 years Explanation:Policyholders can exercise the settlement option in ULIPs for a period of 5 years after the date of maturity.
Q236.
What is the objective of bringing uniformity to unit pricing in ULIPs?

a.

To increase the value of units

b.

To protect the interests of policyholders

c.

To decrease the transparency of unit transactions

d.

To maximize insurer profits

Discuss
Answer: (b).To protect the interests of policyholders Explanation:The objective of bringing uniformity to unit pricing in ULIPs is to protect the interests of policyholders.
Q237.
How does the basic equity principle apply to unit transactions in ULIPs?

a.

It ensures the interests of policyholders remain unaffected by transactions.

b.

It prioritizes the interests of insurers over policyholders.

c.

It maximizes profits for policyholders.

d.

It allows for fluctuations in NAV based on unit transactions.

Discuss
Answer: (a).It ensures the interests of policyholders remain unaffected by transactions. Explanation:The basic equity principle in ULIPs ensures that the interests of policyholders who are not involved in unit transactions remain unaffected.
Q238.
Why is it important to have uniform cut-off timings for allocation and redemptions in ULIPs?

a.

To increase insurer profits

b.

To simplify operational procedures for insurers

c.

To enable policyholders to verify prices allocated or redeemed

d.

To discourage policyholders from making transactions

Discuss
Answer: (c).To enable policyholders to verify prices allocated or redeemed Explanation:Uniform cut-off timings for allocation and redemptions in ULIPs enable policyholders to verify the prices allocated or redeemed.
Q239.
How should insurers expedite the clearing of outstanding premium cheques received from policyholders?

a.

By delaying the clearance process

b.

By ignoring the cheques altogether

c.

By ensuring timely redemption of units

d.

By investing the cheques in high-risk assets

Discuss
Answer: (c).By ensuring timely redemption of units Explanation:Insurers should expedite the clearing of outstanding premium cheques received from policyholders by ensuring timely redemption of units.
Q240.
Why is it important to have uniform nomenclature for charges in ULIPs?

a.

To confuse policyholders

b.

To make comparison with peer products difficult

c.

To increase transparency for policyholders

d.

To simplify charge structures for insurers

Discuss
Answer: (c).To increase transparency for policyholders Explanation:Having uniform nomenclature for charges in ULIPs increases transparency for policyholders and makes it easier for them to understand the various charges.
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