Insurance MCQ daily is very useful to all Insurance aspirants who want to make Insurance a successful career.
Insurance Daily MCQ is very helpful to all those who are preparing for various competitive exams. This MCQ will certainly add value to their Insurance learning. Practice it daily with us and get a competitive advantage over your competitors.
These 20 Insurance MCQ’s covering across all branches of Insurance to provide more awareness to all Insurance aspirants.
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Q-1- How to detemine any prospect’s insurance requirement from below suggested methods?
- Having a conversation to determine what insurance coverage the prospect wants to purchase
- Performing a thorough risk management review of the prospect’s loss exposures
- Selling the prospect as much coverage as it can afford, given its insurance purchasing budget
- Determining if the prospect’s insurance needs can be placed in the standard market or placed in the residual market.
Option-2 Risk management reveiew is the most common method to determine prospect’s insurance determine.
Q-2- Which of the following does NOT determine the underwriting capacity of an insurer?
- Availability and cost of adequate reinsurance
- Ability to generate an acceptable return on equity
- Standardized methods used to organize underwriting activities
- The volume of premiums written relative to the insurer’s policyholders’ surplus
Option-3 Standardized methods used to organize underwriting activities
Q-3- What does COPE as an acronym describing a common tool used in underwriting the fire peril and other causes of loss to property?
- Conditions, Omissions, Perils, and Exclusions
- Concealment, Omissions, Protection, and Exclusions
- Commercial, Operations, Production, and Entertainment
- Construction, Occupancy, Protection, and External exposure
Option-4 COPE in fire underwriting refers to Construction, Occupancy, Protection, and External exposure
Q-4- Which of the following policy provisions does NOT affect the determination of the amount an insurer is obligated to pay at the time of a covered loss to the property?
- The policy’s coverage limit
- The policy’s deductible provisions
- The policy’s coinsurance provisions
- The insurable interest of all persons insured at policy inception
Option-4 The insurable interest of all persons insured at policy inception.
Q-5- Which of the following is NOT a characteristic of umbrella and excess liability insurance?
- Each requires the insured to pay for losses equal to the self-insured retention or the deductible
- Each provides liability coverage in excess of the underlying policy limits
- Umbrella liability insurance provides coverage for gaps in the underlying policies but the excess liability insurance does not
- Loss frequency rather than loss severity is the primary concern in the underwriting umbrella and excess liability insurance
Option-4
Q-6- Which of the following is an ethical obligation insurers have with regard to using their superior knowledge of loss control and prevention?
- Earn a profit
- Assist in preventing or reducing accidental losses
- Decline coverage for exposures that may have a loss
- Provide funds for government-sponsored disaster relief programs
Option-2 Assist in preventing or reducing accidental losses.
Q-7- Which of the following potential claimants does NOT have an insurable interest in property damaged or destroyed by a covered cause of loss?
- Common carriers transporting the property
- An unsecured creditor of the property owner
- A person who leases the property from the owner
- Warehouse operators acting as custodians of the property
Option-2 An unsecured creditor of the property owner
Q-8- Which of the following causes of loss are common carriers liable for when a shipper’s goods are damaged?
- By an act of God
- By negligence of the shipper
- By some inherent defect or vice of the goods
- By theft, while the property is in the care, custody, and control of the carrier
Option-4 By theft while the property is in the care, custody, and control of the carrier
Q-9- Which of the following is NOT a reason why reinsurance is purchased?
- Reinsurance stabilizes loss experience
- Reinsurance increases underwriting capacity
- Reinsurance may provide underwriting guidance
- Reinsurance reduces the number of claims incurred
Option-4 Reinsurance purchase is indifferent from it reduces the number of claims incurred.
Q-10- Which of the following is true regarding a facultative reinsurance contract?
- The reinsurer agrees in advance to accept a set proportion of all loss exposures underwritten by the primary insurer.
- Both the primary insurer and the reinsurer may cancel the contract at any time with sufficient notice.
- The reinsurer is obligated to accept all loss exposures underwritten by the primary insurer.
- The primary insurer must negotiate a separate agreement for each loss exposure it wants to reinsure.
Option-4 The primary insurer must negotiate a separate agreement for each loss exposure it wants to reinsure.