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 6 of 16

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Q51.
Do Government Securities attract Tax Deduction at Source (TDS)?

a.

Yes

b.

No

c.

May be Yes or No

d.

Can't say

Discuss
Answer: (b).No Explanation:Government securities do not attract TDS (Tax Deduction at Source).
Q52.
What are the two main types of income that an insurance company needs to consider when dealing with Government Securities?

a.

Operating income and financing income

b.

Revenue Income and Capital gains

c.

Dividend income and interest income

d.

Rental income and royalty income

Discuss
Answer: (b).Revenue Income and Capital gains Explanation:An insurance company needs to consider Revenue Income and Capital gains when dealing with Government Securities.
Q53.
How does the treatment of interest income from Government Securities depend on?

a.

Market demand

b.

Time and terms of purchase and sales of securities

c.

Government regulations

d.

Inflation rate

Discuss
Answer: (b).Time and terms of purchase and sales of securities Explanation:The treatment of interest income from Government Securities depends on the time and terms of purchase and sales of securities.
Q54.
What is the specific consideration for an insurance company when dealing with income from Government Securities?

a.

Political stability

b.

Time value of money

c.

Inflation rate

d.

Revenue Income and Capital gains

Discuss
Answer: (d).Revenue Income and Capital gains Explanation:Insurance companies need to specifically consider Revenue Income and Capital gains when dealing with income from Government Securities.
Q55.
What is the purpose of the Insurance Regulatory and Development Authority (Investment) Regulations 2000?

a.

To promote competition among insurance companies

b.

To protect the interests of policyholders' funds and interests

c.

To regulate premium rates

d.

To establish new insurance companies

Discuss
Answer: (b).To protect the interests of policyholders' funds and interests Explanation:The purpose of the Insurance Regulatory and Development Authority (Investment) Regulations 2000 is to protect the interests of policyholders' funds and interests.
Q56.
What is the meaning of "Investment Assets" according to the regulations?

a.

All assets owned by an insurance company

b.

Assets purchased by policyholders

c.

All investments made out of shareholders' funds and policyholders' funds

d.

Assets used for operational purposes

Discuss
Answer: (c).All investments made out of shareholders' funds and policyholders' funds Explanation:"Investment Assets" mean all investments made out of shareholders' funds and policyholders' funds, as specified in the regulations.
Q57.
What does "Money Market Instruments" include according to the regulations?

a.

Long-term bonds

b.

Equity shares of listed companies

c.

Short-term funds with maturity not more than one year

d.

Real estate investments

Discuss
Answer: (c).Short-term funds with maturity not more than one year Explanation:Money Market Instruments comprise short-term funds with maturity not more than one year, including various specified instruments such as Certificate of Deposits, Commercial Paper, Repos, Treasury Bills, and others.
Q58.
What is the significance of the amendments made to the Investment Regulations?

a.

To increase policy premiums

b.

To reduce investment options for insurance companies

c.

To protect the interests of policyholders' funds and interests

d.

To encourage risky investments

Discuss
Answer: (c).To protect the interests of policyholders' funds and interests Explanation:The amendments to the Investment Regulations are made to protect the interests of policyholders' funds and interests, ensuring prudent investment practices by insurance companies.
Q59.
What does Regulation 4 of the IRDA (Investment) (5th Amendment) Regulations 2013 specify for life insurance business?

a.

The premium rates for life insurance policies

b.

The manner of investments for life insurance business

c.

The types of policies offered by life insurers

d.

The maximum sum assured for a life insurance policy

Discuss
Answer: (b).The manner of investments for life insurance business Explanation:Regulation 4 outlines the manner of investments for life insurance business, specifying how insurers carrying on the business of life insurance in India should invest and keep invested their funds.
Q60.
According to Regulation 5, how should insurers carrying on Pension, Annuity, and group Business invest their assets?

a.

Only in government securities

b.

In any manner as per the discretion of the insurer

c.

In a manner specified in the regulation

d.

Exclusively in real estate investments

Discuss
Answer: (c).In a manner specified in the regulation Explanation:Regulation 5 specifies the manner in which insurers carrying on Pension, Annuity, and group Business should invest and keep invested their investment assets, without prejudice to certain provisions of the Insurance Act.
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