Welcome to Insurance Awareness Questions in AffairsCloud.com. Here we are covering some important Insurance Awareness Questions & Answers with Explanations. It will help you to know the important terms, condition, definitions and abbreviation related with
- A method of valuing insured property, or the value computed by that method is known as
1.Actual cost validity
2.Actual cash value
3.Replacement cash value
4.Normal cost value
5.None of theseAnswer – 2.Actual cash value
Actual Cash Value (ACV) is a method of valuing insured property, or the value computed by that method. Actual Cash Value (ACV) is not equal to replacement cost value (RCV). ACV is computed by subtracting depreciation from replacement cost.
- _____________ is the maximum amount an insurance company will pay if an insured asset is deemed a total loss.
4.Guaranteed Replacement Cost
5.None of theseAnswer – 1.Insurance value
Define insurance value is the maximum amount an insurance company will pay if an insured asset is deemed a total loss.
- SEF is abbreviated as _____________________
1.Standard Endorsement Form
2.Secure Endorsement Form
3.Standard Envelope Form
4.Standard Endorsement Fair
5.None of theseAnswer – 1.Standard Endorsement Form
SEF – Standard Endorsement Form Can be added to an Automobile Insurance policy and serve the purpose of either adding or removing coverage from the policy.
- Which of the following is a combination of insurance as well as investment ?
1.Money back policy
3.Unit Link Insurance Plan
5.None of theseAnswer – 3.Unit Link Insurance Plan
Unit Link Insurance Plan is basically a combination of insurance as well as investment, while mutual funds are a pure investment avenue
- Investment in ULIPs is related to which section of the Income Tax Act ?
5.None of theseAnswer – 4.80C
Investment in ULIPs is eligible for tax benefit up to a maximum of Rs 1.5 lacs under Section 80C of the Income Tax Act.
- Which of the following is an example of Broad Form Insurance ?
5.None of theseAnswer – 2.Automobile insurance
An automobile insurance is an example of Broad Form Insurance .A customer may require glass insurance as the driver is frequently on the highway and obtains a lot of chips in the front window.
- Which policy referring to policies that provide coverage only for loss caused by the perils ?
5.None of theseAnswer – 2.Named Perils
Named Perils is a property insurance term referring to policies that provide coverage only for loss caused by the perils specifically listed as covered.
- Which type of insurance usually requires higher premium ?
1.Broad Form insurance
2.Whole life insurance
5.None of theseAnswer – 1.Broad Form insurance
‘Broad Form Insurance’ is an Insurance coverage that extends beyond the basics to include rare events that may be of serious risk to the insured. This type of insurance usually requires that a higher premium, and often a deductible, be paid
- What is PAC ?
5.None of theseAnswer – 2.Pre-Authorized Chequing
Pre-Authorized Chequing is an authorization by the insured to allow the Insurance Company to automatically withdrawal their insurance payments from their chequing account.
- Which of the following form is designed to be used by many different insurers and has exactly the same provisions ?
1.Guaranteed Replacement Form
2.Standard insurance Form
3.Standard Endorsement Form
4.Standard Policy Form
5.None of theseAnswer – 4.Standard Policy Form
Standard Policy Form is an insurance policy form that is designed to be used by many different insurers and has exactly the same provisions, regardless of the insurer issuing the policy.