Unit – 5 – Quiz

Payment of fraudulent or inflated claims results in __________ to all insured.

Select the expanded form of FPA as used in insurance

What does the term “premium” denote in relation to an insurance policy?

The sum assured under key man insurance policy is generally linked to which of the following?

Who among the following is considered as primary stakeholder in insurance claim process?

Are there any fee / charges that need to be paid for lodging the complaint with the Ombudsman?

Most experts agree that you should keep between __________months worth of your living expenses set aside in your emergency fund.

How much amount of gratuity is payable for each year of completed service to the monthly rated employees?

In insurance, the contingency insured against is usually the

For dependent parents, the least important risk to be covered is through

What refers to those risks which involves the potential loss of income as a result of an individual’s loss of ability to earn an income?

Which of the following intermediaries do not require IRDA’s license/approval to operate in India?

An Actuary is expected to

Which of the below is the most appropriate explanation for the fact that young people are charged lesser life insurance premium as compared to old people?

Human Life Value (HLV) is nothing but the present value
of total monetary surplus available to an individual’s family members excluding

According to the principle of indemnity, the insured is paid for

The underwriting process is completed when

The duty of disclosure arises

Supposing that the risk premium which would be sufficient to provide protection is Rs.200 and the insurer expects to earn 5% p.a. interest on the premium ‘to be charged’ from the insured person, what would be the pure premium?

If expenses are 27% of the gross (office) premium and the Pure premium is Rs. 1,800 then what would be the Office premium

Rakesh Sharma has recently being diagnosed with diabetes. He is only 38 years old. Rakesh is very keen to get insurance cover and is willing pay a high premium. Rakesh Sharma’s main intention in taking out an insurance plan is to transfer the cost of the medical expenses that are likely to occur in the near future to the insurance company. Also, in case he dies, the claim from the life insurance company should be sufficient for his family to maintain a decent lifestyle. If people like Rakesh Sharma are selected by the insurance company in large numbers, this could lead to

A comprehensive health insurance policy of Rs. 3 lakh is purchased by insured person in a given underwriting class. They generate incurred losses and loss adjustment expenses of Rs. 85 lakh within a year. If expenses are 40% of the gross rate, calculate the final gross premium by pure premium method.

One line of business has incurred losses and loss adjustment expenses amounting to Rs. 4 lakh and earned premium of Rs. 6 lakh. Expected loss ratio is 55%. Calculate the rate of change in the existing premium.

Anirudh Singh has a savings policy. The following are the details of the policy: Policy term 20 years Date of commencement of policy 4 June 2001 Sum insured Rs. 5,00,000 Premium payment mode Annually Last premium paid 4 June 2008 Number of premiums paid 8 Total number of premiums due 20 Vested bonus Rs. 50,000 As seen from the data above, Anirudh Singh stopped premium payment after the Eighth year. The policy will not be fully cancelled. Instead the sum insured will be reduced in proportion to the premiums paid. What is the paid up value.

Mr. Atul is the MD of Star Investments Ltd. His contribution to the company’s profit is estimated at 40% of the total profit. The shareholders of the company believe that they will get a return of 4% if there is no management. They can place their money in bank deposits at 4% pa., if there is no management. It is also estimated that 5 years term is required to find a comparable replacement for Mr. Atul. Pretax profit and networth for the last 5 years is Rs. 60,00,000 and 2,85,00,000 respectively . Calculate key man value of Mr Atul.