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 9 of 32

Discover more Topics under IC 14 Regulations of Insurance Business

Q81.
What is a key difference between traditional insurance plans and unit-linked plans?

a.

Premium frequency

b.

Policy duration

c.

Fund selection by the policyholder

d.

Level of coverage

Discuss
Answer: (c).Fund selection by the policyholder Explanation:In traditional insurance plans, the policyholder has no say in choosing the type of securities in which their funds are invested. In unit-linked plans, the policyholder can choose the fund (asset type) in which their premiums will be invested.
Q82.
What does the policyholder have the flexibility to do once the ULIP contract is issued?

a.

Change the policy duration

b.

Increase the premium amount

c.

Decrease the level of coverage

d.

Choose the frequency of premium payment

Discuss
Answer: (b).Increase the premium amount Explanation:Once the ULIP contract is issued, the policyholder has the flexibility to contribute additional premiums (as top-up premium) if any surplus monies are available.
Q83.
What option is available to the policyholder in a ULIP to safeguard the value of their funds in difficult times?

a.

Partial withdrawal

b.

Decreasing the sum assured

c.

Switching between funds

d.

Opting for a single premium policy

Discuss
Answer: (c).Switching between funds Explanation:In a ULIP, the policyholder has the option to switch from one fund to another, which helps safeguard the value of their funds in difficult times.
Q84.
What is the definition of linked business according to IRDA (Registration of Indian Insurance Companies) Regulations, 2000?

a.

Contracts related to health insurance

b.

Contracts with fixed benefits

c.

Contracts under which benefits are determined by underlying assets or approved index

d.

Contracts with variable premiums

Discuss
Answer: (c).Contracts under which benefits are determined by underlying assets or approved index Explanation:Regulation 2 (i) of IRDA (Registration of Indian Insurance Companies) Regulations, 2000 defines linked business as "life insurance contracts or health insurance contracts under which benefits are wholly or partly to be determined by reference to the value of underlying assets or any approved index."
Q85.
What does Regulation 3 (3) of IRDA (Investment) Regulations, 2000 state about Unit Linked Life Insurance Business?

a.

It restricts insurers from investing in any marketable assets

b.

It mandates insurers to invest in approved categories of investments only

c.

It allows insurers to invest up to 50% of the fund in other than approved categories

d.

It prohibits investments in marketable assets for unit-linked policies

Discuss
Answer: (b).It mandates insurers to invest in approved categories of investments only Explanation:Regulation 3 (3) of IRDA (Investment) Regulations, 2000 states that insurers shall invest and at all times keep invested the segregated fund of unit-linked life insurance business as per the approved pattern of investment offered to and approved by the policyholders.
Q86.
Besides specific regulations for unit-linked insurance, which regulation pertains to the treatment of discontinued linked insurance policies?

a.

IRDA (Insurance Advertisements and Disclosures) Regulations, 2000

b.

IRDA (Protection of Policyholders' Interests) Regulations, 2002

c.

IRDA (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010

d.

Code of Conduct applicable to Insurance Agents

Discuss
Answer: (c).IRDA (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010 Explanation:The regulation pertaining to the treatment of discontinued linked insurance policies is IRDA (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010.
Q87.
What are the minimum criteria expected of a ULIP product according to the circulars?

a.

Fixed insurance cover, short term nature, technical jargon, and non-transparency

b.

Reasonable insurance cover, linkage to premium payment, availability of targeted sum, and simplicity

c.

Variable premiums, long term nature, technical jargon, and complexity

d.

Variable benefits, short term nature, transparency, and non-disclosure

Discuss
Answer: (b).Reasonable insurance cover, linkage to premium payment, availability of targeted sum, and simplicity Explanation:The minimum criteria expected of a ULIP product include reasonable insurance cover with a linkage to the premium payment during the term of the contract, availability of a greater part of a targeted sum at the longer end, basic features of a life insurance contract, simplicity, transparency, and alignment of investment strategy to the long term nature of these contracts.
Q88.
What is the requirement for life insurance companies regarding the training of agents and intermediaries selling ULIP products?

a.

Periodical in-house training for all agents, regardless of the products they sell

b.

Specialized training for agents selling traditional insurance products

c.

Training on ULIP products only for new agents

d.

Refresher training for agents selling non-ULIP products

Discuss
Answer: (a).Periodical in-house training for all agents, regardless of the products they sell Explanation:Life insurance companies are required to provide periodical in-house training to all their insurance agents and intermediaries before they start soliciting insurance business. Separate training should be given to those authorized to sell ULIP products, including the basic features and inherent risks.
Q89.
What should be included in the curriculum of the training for agents and intermediaries selling ULIP products?

a.

Advanced investment strategies

b.

In-depth knowledge of traditional insurance products

c.

Basic features and inherent risks of ULIP products

d.

Sales techniques for non-ULIP products

Discuss
Answer: (c).Basic features and inherent risks of ULIP products Explanation:The curriculum of training for agents and intermediaries authorized to sell ULIP products must include the basic features and inherent risks of ULIP products.
Q90.
What documentation should life insurance companies maintain to demonstrate an informed decision in deciding a particular product?

a.

Comprehensive records of all policyholders

b.

General records of insurance products

c.

Appropriate documentation related to a specific product

d.

Records of all training sessions conducted

Discuss
Answer: (c).Appropriate documentation related to a specific product Explanation:Life insurance companies must maintain appropriate documentation related to a specific product to demonstrate an informed decision.
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