Chapter 4: Insurance Services — Online MCQ Test
COMMERCE · CLASS 12 INTERMEDIATE 2 YEAR · Telangana State Board
Practice Chapter 4: Insurance Services with a free chapter-wise online MCQ test.
This chapter covers: This chapter details insurance principles life marine fire health insurance policies privatization of insurance sector and IRDAI regulatory framework..
AI-generated questions from basic to board-exam level, with instant results and explanations.
Chapter 4: Insurance Services — Important Questions & Answers
Which principle of insurance means that the insured must have a financial interest in the subject matter of insurance?
- A. Utmost good faith
- B. Insurable interest
- C. Subrogation
- D. Contribution
Answer: B. Insurable interest
Insurable interest means the policyholder must stand to suffer financial loss if the insured event occurs. It is a basic requirement for a valid insurance contract.
Insurable interest means the policyholder must stand to suffer financial loss if the insured event occurs. It is a basic requirement for a valid insurance contract.
Which type of insurance provides protection against loss of life?
- A. Marine insurance
- B. Fire insurance
- C. Life insurance
- D. Health insurance
Answer: C. Life insurance
Life insurance gives financial protection to the nominee or family in the event of the insured person's death. It is designed to cover human life risk.
Life insurance gives financial protection to the nominee or family in the event of the insured person's death. It is designed to cover human life risk.
A trader insures goods in transit against loss by sea. Which type of insurance is this?
- A. Fire insurance
- B. Life insurance
- C. Marine insurance
- D. Health insurance
Answer: C. Marine insurance
Marine insurance covers goods or ships during transit by sea, air, or land in certain cases. It protects against perils related to transport.
Marine insurance covers goods or ships during transit by sea, air, or land in certain cases. It protects against perils related to transport.
The transfer of an insured person's right to recover loss from a third party to the insurer is called
- A. Subrogation
- B. Contribution
- C. Reinsurance
- D. Assignment
Answer: A. Subrogation
Subrogation allows the insurer, after paying the claim, to take over the insured's legal rights against the responsible third party. This prevents double recovery.
Subrogation allows the insurer, after paying the claim, to take over the insured's legal rights against the responsible third party. This prevents double recovery.
Which of the following is a correct statement about privatization of the insurance sector in India?
- A. Only government companies can issue insurance policies
- B. Private companies were allowed entry after sector reforms
- C. Insurance is not regulated by any authority
- D. Life insurance and general insurance are merged into one policy
Answer: B. Private companies were allowed entry after sector reforms
Economic reforms opened the insurance sector to private participation. This increased competition, choice, and expansion in insurance services.
Economic reforms opened the insurance sector to private participation. This increased competition, choice, and expansion in insurance services.