Investment of Insurance Companies And IRDA Regulations MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Investment of Insurance Companies And IRDA Regulations, a fundamental topic in the field of IC 89 Management Accounting. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Investment of Insurance Companies And IRDA Regulations 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 Investment of Insurance Companies And IRDA Regulations mcq questions that explore various aspects of Investment of Insurance Companies And IRDA Regulations problems. Each MCQ is crafted to challenge your understanding of Investment of Insurance Companies And IRDA Regulations principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC 89 Management Accounting tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Investment of Insurance Companies And IRDA Regulations MCQs are your pathway to success in mastering this essential IC 89 Management Accounting topic.

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Investment of Insurance Companies And IRDA Regulations MCQs | Page 11 of 16

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Q101.
___________ reflects volatility of return on an investment relative to market swings.

a.

Variance

b.

Alpha

c.

Beta

d.

Standard deviation

Discuss
Answer: (c).Beta Explanation:Beta reflects the volatility of return on an investment relative to market swings. A beta greater than 1 indicates higher volatility than the market, while a beta less than 1 suggests lower volatility.
Q102.
Which of the following Government securities are rooted with derivatives, such as call options and put options?

a.

Securities with embedded derivatives

b.

Zero coupon bonds

c.

Securities with variable coupon rates

d.

Securities with fixed coupon rates

Discuss
Answer: (a).Securities with embedded derivatives Explanation:These government securities have embedded derivatives, such as call options or put options. Embedded derivatives are components within a financial instrument that have characteristics of standalone derivatives.
Q103.
What is the maximum period of maturity for money market instruments?

a.

Two years

b.

One year

c.

Three years

d.

Five years

Discuss
Answer: (b).One year Explanation:Money market instruments are short-term debt instruments that have maturities typically ranging from overnight to one year. These instruments are designed for short-term funding and liquidity management.
Q104.
What is the limit of investment in immovable property covered under Section 27A(1 )(n) of the IRDA regulations in case of General Insurer?

a.

1% of the Investment Assets

b.

2% of the Investment Assets

c.

3% of the Investment Assets

d.

5% of the Investment Assets

Discuss
Answer: (c).3% of the Investment Assets Explanation:The limit of investment in immovable property covered under Section 27A(1)(n) of the IRDA regulations for a General Insurer is 3% of the Investment Assets.
Q105.
As per Regulation 13, provision on investment management, for applications received, with local cheques payable at par at the place where the premium is received, before cut-off Time (3.00pm) on a business day, what will be the applicable NAV?

a.

The opening NAY of same day

b.

The closing NAY of same day

c.

The opening NAY of next day

d.

The closing NAY of next day

Discuss
Answer: (b).The closing NAY of same day Explanation:For applications received with local cheques payable at par at the place where the premium is received, before the cut-off time (3:00 pm) on a business day, the applicable NAV would be the closing NAV of the same day.
Q106.
As per Directives for Investment in Alternative Investment Funds for insurers, what is the permissible limit of exposure to a single AIF or venture fund for insurers?

a.

Not more than 1 percent of fund size

b.

Not more than 5 percent of fund size

c.

Not more than 10 percent of fund size

d.

Not more than 20 percent of fund size

Discuss
Answer: (c).Not more than 10 percent of fund size Explanation:The permissible limit of exposure to a single Alternative Investment Fund (AIF) or venture fund for insurers is not more than 10 percent of the fund size.
Q107.
What is the maturity period range of Government Securities?

a.

1 year to 5 years

b.

5 years to 10 years

c.

10 years to 20 years

d.

3 years to 30 years

Discuss
Answer: (d).3 years to 30 years Explanation:Government Securities generally have a maturity period ranging from 3 years to 30 years.
Q108.
According to IRDA Investment Regulations, what is the minimum investment requirement in Central Government securities for life insurance companies?

a.

Not less than 10% of total investable funds

b.

Not less than 25% of total investments

c.

Not less than 50% of total investable funds

d.

Not less than 75% of total investments

Discuss
Answer: (b).Not less than 25% of total investments Explanation:According to IRDA Investment Regulations, life insurance companies are required to invest not less than 25% of their total investments in Central Government securities.
Q109.
What is a key feature of Government Securities that makes them attractive to investors?

a.

High risk

b.

Backed and guaranteed by the government

c.

Variable coupon rates

d.

Market volatility

Discuss
Answer: (b).Backed and guaranteed by the government Explanation:Government securities are considered risk-free as they are backed and guaranteed by the government.
Q110.
How are Government Securities issued in the market?

a.

At a premium only

b.

At face value only

c.

At a discount only

d.

At face value, at a premium, or at a discount depending on interest rates

Discuss
Answer: (d).At face value, at a premium, or at a discount depending on interest rates Explanation:Government securities can be issued at face value, at a premium, or at a discount depending on the interest rates in the market.
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