LIC HFL Insurance Awareness Questions 2019 (Day – 112)

Dear Aspirants, LIC HFL is one of the most important exam in the competitive examination. LIC HFL mains exam consists of three sections i.e. Reasoning ability and Numerical Ability, General knowledge & Current affairs and Insurance & Financial Market Awareness. LIC HFL Insurance Awareness & Financial Market Awareness section comprises of 50 questions. LIC HFL Insurance Awareness Questions 2019 play an important role in boosting up the score in mains examination and also helps in the interview. Here we are providing a new series of LIC HFL Insurance Awareness Questions 2019. Aspirants can make use of this LIC HFL Insurance Awareness Questions 2019, to improve score in the Insurance & Financial Market Awareness section.

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LIC HFL Insurance Awareness Questions 2019 (Day – 112)

1) What term is used to refer the making compensation payments to one party by the other for the loss occurred?

a) Mitigation

b) Insurability

c) Indemnity

d) Annuity

e) Liability

2) ECGC provides insurance cover to exporters. What is the meaning of the second C in ECGC?

a) Company

b) Corporation

c) Credit

d) Cover

e) None of the Above

3) Which bill was launched to set up resolution corporation to replace DICGC?

a) FRDI Bill

b) FEOB Bill

c) FICGC Bill

d) RBICGC Bill

e) PMDGC Bill

4) UPR is the total annual premium less than the amount earned. What is the full form of UPR?

a) Uniform Premium Research

b) Uninsured Premium Reserve

c) Unearned Premium Reserve

d) Unearned Premium Requirement

e) Uninsured Premium Requirement

5) What is the term used for the ability of an insurer to cover their liabilities and meet the financial requirements of doing insurance business?

a) Claimed Capital

b) Credit Ratio

c) Solvency

d) Reserve Fund

e) Schedule

6) What does the term ‘ACV’, used in insurance context, stand for?

a) Assisting Cash Value

b) Asset Classification Value

c) Actual Claimed Value

d) Asset claimed Value

e) Actual Cash Value

7) What is term used for the bonus given once to a policyholder for maintaining the policy till maturity?

a) Policy Bonus

b) Terminal Bonus

c) Premium Bonus

d) Maturity Bonus

e) Sum Bonus

8) ____________ is the process in which the policyholder legally transfers the rights of life insurance policy to another person for various reasons.

a) Exclusion

b) Assignment

c) Nomination

d) Retrocession

e) Retention

9) ___________ has only access rights to the e-Insurance account in the event of the demise of the policyholder.

a) Key employee

b) Third Party Administrator

c) Public Adjuster

d) Independent Agent

e) Authorized Representative

10) What is the Maximum Insurance premium payable by farmers under Pradhan Mantri Fasal Bima Yojana for all Kharif crops?

a) 2%

b) 3 %

c) 1.5 %

d) 5 %

e) 1 %

Answers :

1) Answer: c)

Indemnity means making compensation payments to one party by the other for the loss occurred. It means security, protection and compensation given against damage, loss or injury. According to the principle of indemnity, an insurance contract is signed only for getting protection against unpredicted financial losses arising due to future uncertainties.

2) Answer: b)

Export Credit Guarantee Corporation of India (ECGC) is an Indian enterprise which is administered by the Government of India through the Ministry of Commerce and Industry. ECGC is wholly owned by the Indian Government and was set up in the year 1957 with the intention to promote exports by offering credit risk insurance and services to exporters. Geetha Muralidhar is the CMD of ECGC. Headquarters- Mumbai.

3) Answer: a)

Financial Resolution and Deposit Insurance (FRDI) Bill came up in 2017 to set up Resolution Corporation to replace Deposit Insurance and Credit Guarantee Corporation (DICGC) which will be tasked to anticipate the risk of failure, taking corrective action & resolving them in case of failure. The corporation will also decide the limit to provide deposit insurance to deposits.

4) Answer: c)

Unearned Premium Reserve (UPR or UEPR) is the number of unexpired premiums on policies or contracts as of a certain date (the total annual premium less the amount earned).

5) Answer: c)

Solvency is the ability of an insurer to cover their liabilities and meet the financial requirements of doing insurance business. If an insurance company is not solvent it may no longer function as insurer for new policies and prospective clients would be unlikely to wish to take policies out with an insurer that couldn’t meet its obligations in the event that they had to make a claim anyway.

6) Answer: e)

In the property and casualty insurance industry, Actual Cash Value (ACV) is a method of valuing insured property, or the value computed by that method. It is not equal to replacement cost value (RCV). ACV is computed by subtracting depreciation from replacement cost. The depreciation is usually calculated by establishing a useful life of the item determining what percentage of that life remains. This percentage multiplied by the replacement cost equals the ACV.

7) Answer: b)

Terminal Bonus is also known as persistency bonus which is paid once, i.e. at the time of maturity of the policy. It is a sort of loyalty bonus given to a policyholder for maintaining the policy till maturity. Its value is not guaranteed and will be disclosed only at the time of policy maturity.

8) Answer: b)

Assignment means the legal transfer of right from one person to another. It can be transferred for various reasons. The original policyholder is called the assignor and the person to whom it will be transferred is called the assignee. The Assignment can be of two types Conditional & Absolute.

9) Answer: e)

An Authorized Representative has only access rights to the e-Insurance account in the event of the demise of the policyholder. The Authorized Representative would only act as a facilitator and is not entitled to receive any policy benefits unless designated as a ‘nominee’ or ‘assignee’ by the deceased policyholder.

10) Answer: a)

The Pradhan Mantri Fasal Bima Yojana provides a comprehensive insurance cover against failure of the crop thus helping in stabilising the income of the farmers. PMFBY was launched by Prime Minister Shri Narendra Modi. There would be a uniform premium of only 2% to be paid by farmers for all Kharif crops and 1.5% for all Rabi crops. In case of annual commercial and horticultural crops, the premium to be paid by farmers would be only 5%.

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