Practice Test

Q1) In fire insurance business _________percentage of premium income is carried forward as provision for and the balance is transferred to profit and loss account. Show Answer

Q2) Insurance business is controlled by Show Answer

Q3) In marine insurance business ______ percentage of premium income is carried forward as provision for and the balance is transferred to profit and loss account. Show Answer

Q4) For the settlement of claim, insurance company Show Answer

Q5) As per IRDA Regulations, 2002, Sun Light Insurance Company carrying business of more than one type of insurance business is required to prepare Show Answer

Q6) In case of fire insurance, the provision required to make against unexpired risk is Show Answer

Q7) As per IRDA Regulations, an insurance company is required to prepare Show Answer

Q8) Insurance commission on general insurance policies issued during the year cannot exceed Show Answer

Q9) Insurance commission on general insurance policies renewed during the year cannot exceed Show Answer

Q10) An insurer carrying on general insurance business shall comply with the requirements of the following Schedule of Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor’s Report of Insurance Companies) Regulations, Show Answer

Q11) The audit report for an insure carrying on general insurance business shall comply with the requirements of the following Schedule of Insurance Regulatory and Development Authority (Preparation of Financial Statements and Auditor’s Report of Insurance Companies) Show Answer

Q12) In the event of loss covered by re-insurance Show Answer

Q13) Receipts and Payment Account [Cash Flow statement] of an insurance company






Show Answer

Q14) Premium shall be recognized as income Show Answer

Q15) Acquisition cost related to the acquisition of new and renewal insurance contracts Show Answer

Q16) Unrealized gains/ losses arising due to changes in the fair value of listed equity shares of a insurance company Show Answer

Q17) In the Financial Statement of an Insurance Company, Underwriting commitments outstanding are shown as Show Answer

Q18) Items of expenses and income shall be shown as a separate line item, in the balance sheet of an insurance company, if Show Answer

Q19) Reserve deposits with ceding companies is shown in the balance sheet of an Insurance Company under Show Answer

Q20) Outstanding premium is shown in the balance sheet of an Insurance Company under Show Answer

Q21) Deposit with Reserve Bank of India u/s 7 of Insurance Act, 1938 is shown in the balance sheet of an Insurance Company under Show Answer

Q22) Deposit held on re-insurance ceded is shown in the balance sheet of an Insurance Company under Show Answer

Q23) Premiums received in advance is shown in the balance sheet of an Insurance Company under Show Answer

Q24) Unallocated premium is shown in the balance sheet of an Insurance Company under Show Answer

Q25) Claims outstanding is shown in the balance sheet of an Insurance Company under Show Answer

Q26) Agents balances is shown in the balance sheet of an Insurance Company under Show Answer

Q27) Premium deficiency Show Answer

Q28) Liability for outstanding claims for a general insurance company shall include Show Answer

Q29) Claims made in respect of general insurance contracts shall be recognized on an actuarial basis Show Answer

Q30) Schedule of premiums of a General Insurance Company will show separately Show Answer

Q31) Reserve for Unexpired Risk is shown in the balance sheet of a General Insurance Company under Show Answer

Q32) Every insurance company in India is required to close its accounts every year on Show Answer

Q33) The commission received from the re-insurer is called Show Answer

Q34) The commission paid by the re-insurer is called Show Answer

Q35) General insurance is defined by Show Answer

Q36) General insurance includes Show Answer

Q37) The insured is not allowed to make any profit is Show Answer

Q38) Fire insurance is subject to Show Answer

Q39) The policy in which the liability of the insurer is limited is Show Answer

Q40) The policy which insures the goods at different places is Show Answer

Q41) The policy in which the insurer agrees to pay a fixed amount is Show Answer

Q42) When more than one policy is taken to cover the same risk it is called Show Answer

Q43) The insurer who agrees to insure is called Show Answer

Q44) The policy which insures the subject matter for a specific voyage is called Show Answer

Q45) The policy which insures the regular matter for a specific period is called Show Answer

Q46) General insurance companies must comply with the requirements of schedule Show Answer

Q47) Schedule B is divided into ______ parts. Show Answer

Q48) Premium received in advance is disclosed under the head Show Answer

Q49) Revenue A/c is prepared in the form Show Answer

Q50) P&L A/c is prepared in form Show Answer

Q51) Balance sheet is prepared in the form Show Answer

Q52) Provision created to meet the claims which may arise in respect of policies which remain unexpired at the end of the year is called as Show Answer

Q53) In the case of marine insurance the provision for unexpired risk as per the Executive Committee of General Insurance council is Show Answer

Q54) In the case of the insurance, the provision for unexpired risk as per the Executive Committee of General Insurance council is Show Answer

Q55) The schedules which form part of Revenue A/c are Show Answer

Q56) The schedules which form part of Balance sheet are Show Answer

Q57) Re-insurance obligations are disclosed under Show Answer

Q58) Share premium is disclosed under Show Answer

Q59) Fixed deposits are disclosed under Show Answer

Q60) Derivative instruments are disclosed under Show Answer

Q61) Money at call and short notice is disclosed under Show Answer

Q62) Outstanding premium are shown under Show Answer

Q63) Reserve for unearned premium is shown under Show Answer

Q64) Deposits held on Reinsurance ceded is shown under Show Answer

Q65) Re-insurance claim receivable is disclosed under Show Answer

Q66) Dividend distribution tax is disclosed under Show Answer

Q67) Applications money for investments is shown under Show Answer

Q68) Commission on Re-insurance accepted is added to Show Answer

Q69) Claim on Re-insurance accepted is added to Show Answer

Q70) Premium on Re- insurance ceded is deducted from Show Answer

Q71) General insurance business includes fire insurance only. Show Answer

Q72) In fire insurance, the compensation is equal to the loss incurred. Show Answer

Q73) Fire insurance policies is introduced to discourage over insurance. Show Answer

Q74) Average clause is introduced to discourage over insurance. Show Answer

Q75) Reinsurance is done when the risk involved in the subject manner is very heavy. Show Answer

Q76) When a company gets reinsurance business, it has to pay commission. Show Answer

Q77) Commission on reinsurance ceded is credited to Revenue A/c. Show Answer

Q78) Schedule B of IRDA Regulation is divided is divided into 10 parts. Show Answer

Q79) In the case of marine insurance, provision for unexpired risk is 100% of Net Premium. Show Answer

Q80) In case of other insurance, provision for unexpired insurance is 60% of Net Premium. Show Answer

Q81) Provision for unexpired risk is shown in the Balance Sheet on asset side. Show Answer

Q82) Claim on Re-insurance accepted is added to claims paid. Show Answer

Q83) Claim on Re-insurance ceded is deducted from claims paid to get total claim incurred. Show Answer

Q84) Claim outstanding at the end of the year is added to claims aid. Show Answer

Q85) Commission earned on Reinsurance ceded is added to commission paid to get Net Commission. Show Answer

Q86) Claim outstanding at the beginning of the year is deducted from claims paid to arrive at claims incurred. Show Answer

Q87) Reinsurance obligations are contingent liabilities. Show Answer

Q88) Derivative instruments are shown under other investments in the Balance Sheet of General Insurance Companies. Show Answer

Q89) Share transfer fee received is shown under other Income in P & L A/c of General Insurance Companies. Show Answer

Q90) Final account of insurance companies need not be prepared in prescribed form. Show Answer

Q91) Reserve for unearned premium is shown under current liabilities. Show Answer