C04 Features of Insurance Contracts MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on C04 Features of Insurance Contracts, a fundamental topic in the field of IC38 Life Insurance Agent Exam. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our C04 Features of Insurance Contracts 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 C04 Features of Insurance Contracts mcq questions that explore various aspects of C04 Features of Insurance Contracts problems. Each MCQ is crafted to challenge your understanding of C04 Features of Insurance Contracts principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC38 Life Insurance Agent Exam tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our C04 Features of Insurance Contracts MCQs are your pathway to success in mastering this essential IC38 Life Insurance Agent Exam topic.

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C04 Features of Insurance Contracts MCQs | Page 4 of 5

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Q31.
What is the consideration in an insurance contract?

a.

The insurer's willingness to provide coverage

b.

The premium paid by the insured

c.

The specified risks covered by the policy

d.

The enforceability of the contract

Discuss
Answer: (b).The premium paid by the insured Explanation:The consideration in an insurance contract is the premium paid by the insured.
Q32.
Which of the following is NOT one of the elements of a valid contract?

a.

Offer and acceptance

b.

Capacity of the parties

c.

Legality of the object

d.

The policy coverage

Discuss
Answer: (d).The policy coverage Explanation:The elements of a valid contract are offer and acceptance, consideration, consensus ad-idem, free consent, capacity of the parties, and legality of the object. The policy coverage is not one of these elements.
Q33.
What is the primary purpose of an insurance contract?

a.

To provide financial protection against specified risks

b.

To enforce legal agreements between parties

c.

To specify the premium amount

d.

To define the elements of a valid contract

Discuss
Answer: (a).To provide financial protection against specified risks Explanation:The primary purpose of an insurance contract is to provide financial protection against specified risks.
Q34.
In the context of insurance, what does "consensus ad-idem" mean?

a.

Both parties fully agree on all contract terms

b.

The insured is bound by all the insurer's terms

c.

The insurer has full control over the contract

d.

The insurer agrees to any changes the insured requests

Discuss
Answer: (a).Both parties fully agree on all contract terms Explanation:"Consensus ad-idem" means that both parties fully agree on all contract terms in the context of insurance.
Q35.
What is the enforceability of a valid contract governed by in India?

a.

Indian Contract Act, 1872

b.

Indian Insurance Act, 1938

c.

Indian Insurance Regulations, 2020

d.

Indian Contract Enforceability Law

Discuss
Answer: (a).Indian Contract Act, 1872 Explanation:The enforceability of a valid contract in India is governed by the Indian Contract Act, 1872.
Q36.
In the context of insurance, what is a "Free-Look Period"?

a.

The time during which the insurer can review the policy

b.

The period in which the insured can change their personal information

c.

A period for policy cancellation and refund if the customer is not satisfied

d.

The period during which claims are temporarily suspended

Discuss
Answer: (c).A period for policy cancellation and refund if the customer is not satisfied Explanation:In the context of insurance, a "Free-Look Period" is a period for policy cancellation and refund if the customer is not satisfied.
Q37.
What is the purpose of a "Free-Look Period" in insurance?

a.

To allow the insurer to make changes to the policy

b.

To provide a grace period for premium payment

c.

To enable the insured to cancel the policy and receive a refund if not satisfied

d.

To extend the coverage of the policy

Discuss
Answer: (c).To enable the insured to cancel the policy and receive a refund if not satisfied Explanation:The purpose of a "Free-Look Period" in insurance is to enable the insured to cancel the policy and receive a refund if not satisfied.
Q38.
In the context of insurance, what is a "Contract of Adhesion"?

a.

A contract that both parties can modify freely

b.

A contract with unclear terms and conditions

c.

A one-sided contract drafted by the insurer

d.

A contract that requires multiple parties to sign

Discuss
Answer: (c).A one-sided contract drafted by the insurer Explanation:In the context of insurance, a "Contract of Adhesion" is a one-sided contract drafted by the insurer.
Q39.
What does "Pro-rata premium" refer to in insurance?

a.

Premium payment made in advance

b.

Premium paid at a higher rate

c.

Premium calculated based on the policy's duration

d.

Premium paid for a new policy

Discuss
Answer: (c).Premium calculated based on the policy's duration Explanation:"Pro-rata premium" in insurance refers to a premium calculated based on the policy's duration.
Q40.
Which among the following cannot be an element in a valid insurance contract?

a.

Offer and Acceptance

b.

Coercion

c.

Consideration

d.

Legality

Discuss
Answer: (b).Coercion Explanation:Coercion is not an element of a valid insurance contract but rather an impediment to its validity. Coercion involves the use of force or threats to pressure one party into an agreement. In the context of contracts, including insurance, coercion can render a contract void or voidable, as it does not involve free and voluntary consent. Coercion is not an element of a valid insurance contract but an act that can invalidate a contract by undermining the requirement of free and voluntary consent, which is essential for the validity of any contract.
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