IC-38 General Insurance Mock Test – English

Subject: General Insurance
Total Questions: 50
Total Marks: 50
Time: 60 Minutes
Question Type: Multiple Choice Questions (MCQs)

Instructions

Each question has four options.
Select the one best answer.
Check the answer key only after completing the test.
This is a practice mock test and not an official examination paper.

Question 1

What is the primary purpose of General Insurance?

A. To provide investment returns only
B. To provide financial protection against various risks and losses
C. To provide life insurance only
D. To provide banking facilities

Question 2

Which of the following is an example of General Insurance?

A. Motor Insurance
B. Term Life Insurance
C. Whole Life Insurance
D. Endowment Insurance

Question 3

What does the principle of Indemnity generally mean?

A. Paying more than the actual loss
B. Compensating the insured for the actual covered loss, subject to policy terms
C. Providing a guaranteed profit
D. Refunding the premium in every case

Question 4

What is Insurable Interest?

A. A legitimate financial interest in the subject matter being insured
B. Ownership of shares in an insurance company
C. Commission earned by an agent
D. Money deposited in a bank

Question 5

Under the principle of Utmost Good Faith:

A. Only the insurer must disclose information
B. Both parties should disclose material facts honestly
C. Only the agent must provide information
D. The customer does not need to disclose anything

Question 6

What is a Material Fact?

A. A fact that may influence the insurer’s assessment or underwriting decision
B. The policy number only
C. The agent’s address
D. The premium receipt

Question 7

What is a Peril?

A. A cause or event that can produce a loss
B. An insurance premium
C. A policy document
D. An insurance agent

Question 8

What is a Hazard?

A. A condition that may increase the probability or severity of a loss
B. The sum insured
C. A claim form
D. The policy period

Question 9

Which is an example of a Physical Hazard?

A. Faulty electrical wiring
B. Deliberately making a false claim
C. Dishonesty
D. Concealing information

Question 10

What is a Moral Hazard?

A. Increased risk arising from a person’s behavior, dishonesty, or attitude
B. Weather conditions
C. Building construction
D. Vehicle model

Question 11

What does Proximate Cause generally refer to?

A. The dominant and effective cause of a loss
B. The most distant cause
C. The first event only
D. The final event only

Question 12

What is the purpose of Subrogation?

A. To allow the insurer, after paying a claim, to pursue recovery from a responsible third party where applicable
B. To increase the premium
C. To cancel the policy
D. To double the sum insured

Question 13

When may the principle of Contribution apply?

A. When the same risk is insured with more than one insurer
B. Only in Life Insurance
C. Only in Travel Insurance
D. When there is no insurance

Question 14

Who is the Policyholder?

A. The person who holds the insurance policy
B. The surveyor only
C. The insurance agent only
D. The hospital only

Question 15

What is an insurance Premium?

A. The amount paid by the insured for insurance coverage
B. The claim amount
C. A bonus
D. The surveyor’s fee

Question 16

What is the main purpose of Underwriting?

A. To assess risk and determine appropriate terms for accepting the risk
B. To advertise insurance products
C. To settle every claim
D. To collect premium only

Question 17

In Motor Insurance, Third-Party Liability Insurance primarily relates to:

A. Legal liability towards third parties
B. Vehicle fuel expenses
C. Driver’s salary
D. Vehicle colour

Question 18

What does Own Damage Cover primarily protect?

A. The insured vehicle against covered loss or damage
B. Only the third-party vehicle
C. The driver’s salary
D. Road maintenance expenses

Question 19

What does IDV stand for in Motor Insurance?

A. Insured Declared Value
B. Insurance Deposit Value
C. Indian Damage Value
D. Insured Driver Verification

Question 20

What is No Claim Bonus (NCB) generally associated with?

A. A renewal benefit/discount for eligible claim-free experience
B. A vehicle purchase loan
C. Third-party liability
D. Road tax

Question 21

A comprehensive motor policy may generally provide:

A. Own damage cover along with third-party liability cover, subject to policy terms
B. Fuel for the vehicle
C. A driving licence
D. Road tax payment

Question 22

What is a Deductible/Excess?

A. The portion of a covered loss that the insured must bear according to policy terms
B. An additional bonus
C. The insurer’s profit
D. The agent’s commission

Question 23

What may be required when making a motor insurance claim?

A. Details of the accident/loss and relevant supporting documents
B. Only a bank passbook
C. Only a school certificate
D. Only an electricity bill

Question 24

Fire Insurance primarily provides protection against:

A. Covered losses caused by fire and other insured perils as specified in the policy
B. Illness
C. Vehicle theft only
D. Death

Question 25

What is Insured Property?

A. Property covered under the insurance policy
B. The insurance agent’s property
C. Government property only
D. Bank property only

Question 26

Burglary Insurance is primarily concerned with:

A. Covered losses arising from burglary/theft-related risks
B. Illness
C. Vehicle depreciation
D. Life risk

Question 27

In Property Insurance, Sum Insured generally represents:

A. The amount or limit for which the property is insured
B. The agent’s commission
C. The tax amount
D. Bank interest

Question 28

Marine Insurance is mainly associated with:

A. Risks related to marine transit, vessels, or goods in transit, depending on the cover
B. Life insurance only
C. Health expenses only
D. Home decoration

Question 29

Marine Cargo Insurance may cover:

A. Risks to goods during transit, subject to policy terms
B. Only the life of the ship’s captain
C. Port employees’ salaries
D. Fuel expenses only

Question 30

Travel Insurance may provide:

A. Protection against specified risks associated with travel
B. Lifetime investment income
C. Permanent vehicle insurance
D. Property ownership

Question 31

What is the primary purpose of Health Insurance?

A. To provide financial protection against eligible medical and healthcare expenses
B. To repair vehicles
C. To insure buildings only
D. To insure cargo only

Question 32

What does Cashless Treatment generally mean?

A. Eligible treatment expenses may be settled directly with a network hospital through the insurer/TPA arrangement
B. Treatment is always free
C. No premium is required
D. Every hospital provides cashless treatment

Question 33

What is a Waiting Period in Health Insurance?

A. A specified period during which certain coverage may not be available, as per policy terms
B. Time spent sitting in a hospital
C. Premium payment time
D. Time taken to print the policy

Question 34

What is a Pre-existing Disease (PED)?

A. A disease or medical condition existing before policy commencement, as defined by the policy
B. Every disease occurring after policy commencement
C. An accident only
D. A common cold only

Question 35

What does TPA stand for in Health Insurance?

A. Third Party Administrator
B. Total Policy Account
C. Third Premium Authority
D. Travel Protection Agency

Question 36

What is a Claim?

A. A request for payment/benefit under the policy for a covered event or loss
B. Premium payment only
C. The process of buying a policy
D. Appointment of an agent

Question 37

What is Claim Intimation?

A. Informing the insurer about a loss or insured event
B. Buying a new policy
C. Increasing the premium
D. Advertising an insurance product

Question 38

What is the primary role of a Surveyor in a general insurance claim?

A. To inspect and assess the loss, where required
B. To sell insurance policies
C. To open bank accounts
D. To collect premiums

Question 39

Why may a surveyor’s report be important in claim settlement?

A. It can assist in assessing the extent and value of the loss
B. It determines agent recruitment
C. It provides bank loans
D. It advertises the policy

Question 40

What is an Exclusion?

A. A loss, event, or circumstance specifically excluded from coverage under the policy
B. An additional benefit
C. A bonus
D. A premium discount

Question 41

What is one purpose of a Deductible?

A. To retain a specified portion of the risk with the insured
B. To always increase the sum insured
C. To make the policy free
D. To increase agent income

Question 42

What does Policy Renewal mean?

A. Continuing insurance coverage after the policy period, subject to applicable terms and conditions
B. Withdrawing a claim
C. Changing the insurance company in every case
D. Always cancelling the policy

Question 43

If a customer does not understand a policy exclusion, an agent should:

A. Explain it clearly
B. Hide the information
C. Make a false promise
D. Avoid providing policy documents

Question 44

Which is an example of Mis-selling?

A. Providing false or misleading information about policy terms or benefits
B. Explaining exclusions accurately
C. Understanding customer needs
D. Providing correct information

Question 45

Why should a General Insurance agent assess the customer’s needs?

A. To recommend suitable insurance coverage
B. Only to increase commission
C. To prevent claims
D. To hide policy terms

Question 46

What is a major role of IRDAI?

A. Regulation and development of the insurance sector in India
B. Vehicle registration only
C. Income tax collection only
D. Providing bank loans only

Question 47

What is the purpose of a Proposal Form?

A. To collect relevant information required for risk assessment
B. To make claim payment immediately
C. To create an agent ID only
D. To cancel a policy

Question 48

If a customer conceals a material fact in the proposal form, it may:

A. Create problems during underwriting or claim assessment
B. Always reduce the premium
C. Always double the claim
D. Automatically generate a bonus

Question 49

What should a good General Insurance agent do?

A. Provide accurate, clear, and complete information to the customer
B. Sell only policies with higher premiums
C. Hide exclusions
D. Guarantee every claim

Question 50

What is the most appropriate approach to recommending General Insurance?

A. Explain suitable coverage based on the customer’s needs and risks
B. Give every customer the same policy
C. Select a policy only based on commission
D. Fill out the proposal without explaining it

Answer Key

Q.	Ans.	Q.	Ans.
1	B	26	A
2	A	27	A
3	B	28	A
4	A	29	A
5	B	30	A
6	A	31	A
7	A	32	A
8	A	33	A
9	A	34	A
10	A	35	A
11	A	36	A
12	A	37	A
13	A	38	A
14	A	39	A
15	A	40	A
16	A	41	A
17	A	42	A
18	A	43	A
19	A	44	A
20	A	45	A
21	A	46	A
22	A	47	A
23	A	48	A
24	A	49	A
25	A	50	A