Introduction MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Introduction, a fundamental topic in the field of IC85 Reinsurance Management. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Introduction 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 Introduction mcq questions that explore various aspects of Introduction problems. Each MCQ is crafted to challenge your understanding of Introduction principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC85 Reinsurance Management tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Introduction MCQs are your pathway to success in mastering this essential IC85 Reinsurance Management topic.

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Introduction MCQs | Page 6 of 13

Discover more Topics under IC85 Reinsurance Management

Q51.
What is the meaning of "statutory cessions"?

a.

A type of reinsurance arrangement

b.

Ceding of a fixed percentage of insurance business by every insurer

c.

Compulsory cession of business to foreign reinsurers

d.

Allocation of cessions equally between two reinsurers

Discuss
Answer: (b).Ceding of a fixed percentage of insurance business by every insurer Explanation:Statutory cessions mean that every insurer is required by law to cede a fixed percentage of their insurance business to approved Indian reinsurers.
Q52.
What is the purpose of the Reinsurance Pools in India?

a.

To increase foreign exchange conservation

b.

To manage reinsurance business in the country

c.

To provide retrocession to member companies

d.

To reduce the retained premiums in the country

Discuss
Answer: (b).To manage reinsurance business in the country Explanation:The Reinsurance Pools in India were formed in Fire and Hull to increase the retained premiums in the country and were managed by the two statutory reinsurers.
Q53.
Which two Indian reinsurers were approved for statutory cessions?

a.

India Reinsurance Corporation and General Insurance Corporation

b.

Indian Guarantee and General Insurance Company and United India Insurance Company

c.

India Reinsurance Corporation and Indian Guarantee and General Insurance Company

d.

General Insurance Corporation and United India Insurance Company

Discuss
Answer: (c).India Reinsurance Corporation and Indian Guarantee and General Insurance Company Explanation:The two Indian reinsurers approved for statutory cessions were India Reinsurance Corporation and Indian Guarantee and General Insurance Company.
Q54.
What is the main reason for the need for reinsurance in India?

a.

To maximise aggregate domestic retention

b.

To minimise the drain of foreign exchange

c.

To secure the best terms for business ceded out of the country

d.

To protect against risks and losses in the insurance business

Discuss
Answer: (d).To protect against risks and losses in the insurance business Explanation:The increased insurance business in India required the need for reinsurance protection to protect against risks and losses.
Q55.
What was the first professional reinsurance insurer formed in India and when was it established?

a.

India Guarantee and General Insurance Company, 1956

b.

India Reinsurance Corporation, 1956

c.

Indian Insurance Companies Association, 1966

d.

National Insurance Co. Ltd., 1971

Discuss
Answer: (b).India Reinsurance Corporation, 1956 Explanation:The India Reinsurance Corporation, a professional reinsurance insurer, was formed by general insurance companies operating in India in 1956.
Q56.
Which types of insurance business were required by statute to be ceded by every insurer in India in 1961?

a.

Fire and Marine Cargo

b.

Marine Hull and Miscellaneous insurance (other than Credit and Solvency)

c.

Credit and Solvency business

d.

All of the above

Discuss
Answer: (d).All of the above Explanation:The government made it compulsory by statute on the part of every insurer to cede 20% in Fire and Marine Cargo, 10% in Marine Hull and Miscellaneous insurance (other than Credit and Solvency), and 5% in Credit and Solvency business to approved Indian reinsurers, namely India Reinsurance Corporation and Indian Guarantee and General Insurance Company.
Q57.
Which company became the Indian reinsurer after nationalisation?

a.

National Insurance Co. Ltd.

b.

The New India Assurance Co. Ltd.

c.

The Oriental Fire and General Insurance Co. Ltd.

d.

General Insurance Corporation of India (GIC)

Discuss
Answer: (d).General Insurance Corporation of India (GIC) Explanation:After nationalisation, General Insurance Corporation of India (GIC) became the Indian reinsurer.
Q58.
What was the aim of the market Reinsurance Programme?

a.

To maximise aggregate domestic retention

b.

To minimise the drain of foreign exchange

c.

To secure the best terms for business ceded out of the country

d.

To increase net retentions

Discuss
Answer: (d).To increase net retentions Explanation:The main objectives of the market Reinsurance Programme were to maximise aggregate domestic retention, to use the large premium base of the domestic market to secure best terms consistent with the quality of business ceded out of the country, and to increase net retentions.
Q59.
How did each of the four subsidiary companies handle their reinsurance cessions?

a.

They handled them through a division styled SWIFT

b.

They matched their treaty cessions to reciprocal inward acceptance of reinsurance

c.

They left it to GIC to handle all non-reciprocal inwards into India

d.

They formed reinsurance pools to increase retained premiums

Discuss
Answer: (b).They matched their treaty cessions to reciprocal inward acceptance of reinsurance Explanation:Each of the four subsidiary companies handled its reinsurance cessions from its head office. In certain lines, the companies matched their treaty cessions to reciprocal inward acceptance of reinsurance
Q60.
What does SWIFT stand for?

a.

Single Window International Facultative and Treaty

b.

Swift International Financial Transactions

c.

Standard and Poor International Financial Transactions

d.

Single Window International Financial Transactions

Discuss
Answer: (a).Single Window International Facultative and Treaty Explanation:SWIFT is an acronym for "Single Window International Facultative and Treaty."
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