Insurance questions and answers

Insurance Questions and Answers

Test and improve on your knowledge of insurance with these Insurance questions and answers. This aptitude test assesses your understanding of the fundamental concepts of insurance.

1.

A clause that prevents the insurer from paying under a policy if the insured killed himself is?

A.

exceptional clause

B.

revival clause

C.

accidental clause

D.

suicide clause

Correct answer is D

The “suicide clause.” Usually, this clause states that no death benefit will be paid if the insured commits suicide within two years of taking out a policy. Whenever an insured person replaces an existing life insurance policy with a new one, the time clock for the suicide clause is set back to zero and starts over again.

2.

A professional charged with the responsibility of assessing loss in insurance

A.

underwriter

B.

adjuster

C.

actuary

D.

broker

Correct answer is B

loss adjuster is an insurance agent who assesses the amount of compensation that should be paid after a person has claimed on their insurance policy.

3.

A risk is classified uninsurable when the

A.

extent of the loss can be calculated

B.

risk will occur no matter the precaution taken

C.

risk may not happen

D.

insurance company cannot pay

Correct answer is B

Uninsurable risk is a condition that poses unknowable or unacceptable risk of loss or a situation in which the insurance would be against the law. Insurance companies limit their losses by not taking on certain risks that are very likely to result in a loss.

In many cases catastrophes, such as earthquakes, have become uninsurable risks. a situation for which an insurance company will not provide insurance, because, for example, it is certain to happen: A person suffering from a terminal illness is considered to be an uninsurable risk.

4.

Which of the following conditions must be met before an insurer is under obligation to pay claim

A.

loss notification

B.

premium payment

C.

completion of proposal form

D.

submission of policy paper to the insurer

Correct answer is B

In insurance, the insurance policy is a contract between the insurer and the insured, known as the policyholder, which determines the claims which the insurer is legally required to pay. In exchange for an initial payment, known as the premium, the insurer promises to pay for loss caused by perils covered under the policy language. The insurer is only obligated to pay for claims if the insured keeps their own part of the bargain by paying the premium.

5.

which class of insurance would be required by a petrol filling station operator whose operation involve high financial  transactions?

A.

burglary policy

B.

public liability policy

C.

goods-in-transit policy

D.

money policy

Correct answer is D

Money insurance policy provides cover for loss of money in transit between the insured’s premises, bank and other specified places occasioned by robbery, theft or any other fortuitous cause. It also provides cover for loss of money in the business premises, safe or vault, etc.