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With the soaring aim to acquire its market share from private sector companies, Life Insurance Corporation is planning to hire two lakh agents (distribution) across the country in the coming ...

 

The proposed  corporate agency norms that authorizes the  banks to sell a specified percentage of insurance policies of other companies is likely to be liberalized by the regulator. Earlier, ...

General Insurance Corporation of India (GIC Re) and 11 other non-life insurers have formed the India Nuclear Insurance Pool. It will have a capacity of Rs 1,500 crore.

 

New India Assurance will ...

Hannover Re, the world's third largest reinsurer, has decided to offer reinsurance cover for the to encourage insurance companies to participate in the scheme. 

 

The global reinsurer is in talks ...

Insurers are staying away from tier-1 perpetual bonds issued by banks because of the lack of liquidity in the instrument and pricing issues in it. Insurance companies also say as the instruments are ...

Canara Bank has entered into a MoU with Life Insurance Corporation of India for offering the Pradhan Mantri Jeevan Jyoti Bima Yojana Insurance cover to all its eligible customers. Canara Bank has ...

The financial sector has a pride of place in the equity portfolio of government-owned Life Insurance Corporation of India (LIC), with 53 of its 309 large picks from the sector. 

 

A business ...

The regulator IRDAI  in an attempt to provide the best and cost effective services for the claimants has directed the insurers as well as the TPA's to pass on discounts, if any, given by hospitals to ...

The Insurance Regulatory and Development Authority of India (IRDAI) has directed the  insurers to correct anomalies in product pricing after careful analysis of the  underwriting practices and make ...

The cost of insurance for aviation companies may rise if the Directorate General of Civil Aviation goes ahead with its plans to make it mandatory for pilots to undergo psychiatric test before takeoff ...

The new service tax rate of 14% will come into effect from June 1, top government sources said, in a move that will make eating out in restaurants, insurance and phone bills expensive, among many ...

With the Indian nuclear insurance pool falling short by Rs.600 crore, some foreign companies have shown an interest in being a part of the initiative. "We have pursued some overseas players and have ...

  

Life Insurance Council has urged the regulator for 50% concession in re-insurance rate on Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), on account that its members face losses as the premium ...

 

Life Insurance Corporation of India (LIC) is looking to collect at least Rs.31,000 crore as first year premiums from insurance product sales in 2015-16. Not only this it is also planning to ...

 

Life Insurance Council is working hard towards making the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) attractive for its member companies apprehending its viability under the present pricing ...

 

Life Insurance Corporation of India (LIC) reported a surplus of Rs.1,803.05 crore in FY 15, up 10.33 per cent over the previous year. The surplus in policy holders' accounts was reflected after ...

 

State owned reinsurer General Insurance Corporation Re has abandoned its expedition to buy a Lloyd's of London syndicate member and instead eyeing to apply for membership of the syndicate.

 

...

A survey by Bajaj Allianz General Insurance said although 75 per cent of respondents were aware that home insurance was essential, only 30 per cent had home insurance for either their home or its ...

 

Life Insurance Corporation of India (LIC) will recruit 5,066 people for the post of Apprentice Development Officers in its various zonal offices. The total number of vacancies, including those on ...

The Securities Appellate Tribunal (SAT) has adjourned an appeal against the IRDAI  in a hearing between SBI Life and the Insurance Regulatory and Development Authority of India (IRDAI). 

 

The case ...

With the soaring aim to acquire its market share from private sector companies, Life Insurance Corporation is planning to hire two lakh agents (distribution) across the country in the coming months. "We are on a recruitment drive," LIC chairman S.K. Roy said. 

 

"We were at 14 lakh a few years ago. Now we are at 12 lakh. We want to go back to that figure. The new regulations have simplified the process. Earlier, it was training, licensing and then becoming active. Now it's only a question of appointment. Now, instead of licensing requirement, it's an appointment. He (agent) gets appointed. The new process is cheaper as licensing has gave away," Roy reported.

 

The proposed  corporate agency norms that authorizes the  banks to sell a specified percentage of insurance policies of other companies is likely to be liberalized by the regulator. Earlier, Insurance Regulatory and Development Authority of India (IRDAI) had said that banks must sell 50% of policies of other insurance companies over the next four years. 

 

IRDAI had proposed a mandatory open architecture, where one bank will have to sell the products of three life, three general and three health insurance companies. As per the draft norms, banks were required to sell products of three companies, with one not exceeding 50% of the promoter company over the next four years.

 

"The regulator is planning to do away with the percentage limits that were prescribed in the draft," said an executive of a life insurance company.

General Insurance Corporation of India (GIC Re) and 11 other non-life insurers have formed the India Nuclear Insurance Pool. It will have a capacity of Rs 1,500 crore.

 

New India Assurance will issue the policy and deal with management of cover to the operators and suppliers, on behalf of all direct insurance companies participating in the pool.

 

The policies offered will be a nuclear operators liability  insurance policy and a nuclear suppliers' special contingency (against right to recourse) insurance policy.

 

A. K. Roy, CMD of GIC Re, said, reinsurance support had come from Nuclear Risk Insurer, London. "Going forward, GIC Re as the pool manager will strive to ensure that this pool develops into a one stop facility for covering all nuclear risks," he added.

 

This pool will be the 27th such market pool globally. It is expected to address third-party liability insurance to begin with and later expand into property and other hot zone (inside reactor areas) risk. This will cover both operators and suppliers. At present, only cold zones (outside reactor areas) are covered.

Hannover Re, the world's third largest reinsurer, has decided to offer reinsurance cover for the to encourage insurance companies to participate in the scheme. 

 

The global reinsurer is in talks with several Indian insurers for the purpose. Ankur Nijhawan, MD Hannover Re Risk Management Services India, reported recently.

 

Having a reinsurance cover will encourage more Indian insurance companies to participate in the PMSBY scheme and improve its penetration in India, he said. 

 

Currently, public sector general insurers are taking the lead and promoting PMSBY in a big way in association with banks. 

Insurers are staying away from tier-1 perpetual bonds issued by banks because of the lack of liquidity in the instrument and pricing issues in it. Insurance companies also say as the instruments are a mix of debt and equity, they are not comfortable investing in these.  he head of fixed income at a life insurance company said there have been some issuances of these Basel III-compliant bonds but they'd stayed away.  "Because they are bank bonds, there have been some demands from provident funds. So, they are priced much lower than what we want it to be," he said.

 

"In perpetual bonds, there is not much of liquidity in the market. In the past, we have invested in these. However, as an insurance market player, we prefer bonds with secondary market liquidity," said Nirakar Pradhan, chief investment officer, Future Generali India Life Insurance.

Canara Bank has entered into a MoU with Life Insurance Corporation of India for offering the Pradhan Mantri Jeevan Jyoti Bima Yojana Insurance cover to all its eligible customers. Canara Bank has also partnered with the United India Insurance Company for offering the Pradhan Mantri Suraksha Bima Yojana Insurance cover. According to the MoU, LIC will offer a life cover of Rs.2 lakh in cash for death of the insured person at a nominal premium of Rs.330 per annum. 

 

All savings bank account holders in age group of 18 to 50 years can avail the of product, the bank said. Similarly, United India Insurance will give accident insurance scheme offering cover for death or disability on account of an accident. 

The financial sector has a pride of place in the equity portfolio of government-owned Life Insurance Corporation of India (LIC), with 53 of its 309 large picks from the sector. 

 

A business Standard analysis of data showed with significant holdings in 33 banks, both private and public sector that, LIC's financial sector investments are a little over than Rs.1 lakh crore or 25.7 per cent of its total equity assets of Rs.4.14 lakh crore as of March. 

 

The exposure, at par with banks and financials' weight age in the BSE 500 index at 25.4 per cent, is a slight increase over the previous year. The data is the aggregate of LIC's stake in companies in which it holds more than one per cent. As the companies don't have to disclose the names of investor holding less than one per cent, LIC's holdings in companies below this limit isn't available in the public domain.

 

During FY 14, the financial sector accounted for 25.25 per cent. The members assume significance as LIC has been playing a key role in capitalizing of public sector banks. During financial year 2014-15, it bought additional shares of UCO Bank, Union Bank, Canara Bank, Bank of India and Central Bank of India. 

 

This was offset by profit booking in State Bank of India, HDFC Bank and Axis Bank, keeping the overall weightage around 25 per cent. Over five years, the insurer's financial sector exposure has remained in a range between a low of 25.3 per cent in March 2010 and a high of 27.2 per cent two years later. However, the number of financial companies has inched up gradually from 43 in 2010 to 53 now. 

The regulator IRDAI  in an attempt to provide the best and cost effective services for the claimants has directed the insurers as well as the TPA's to pass on discounts, if any, given by hospitals to policyholders. 

 

"While every insurer and TPA shall endeavour to get the best and cost effective services to the policyholders or the claimants of health insurance policies, it shall be ensured that the discounts obtained from the hospitals, if any, are passed on to the policyholders or the claimants of the underlying health insurance policy," IRDAI said. 

 

Going forward it has also asked the hospitals to reflect such agreed discounts in the final hospitalization bill of each claim, so that the policyholder or the claimant is aware of the actual  bill raised by the hospital. 

The Insurance Regulatory and Development Authority of India (IRDAI) has directed the  insurers to correct anomalies in product pricing after careful analysis of the  underwriting practices and make things easier for policy holders. 

 

"The (insurance) companies need to correct aberrations that exist in terms of adequate pricing based on scientific analysis of claims," Senior Joint Director of IRDAI Suresh Mathur said while speaking at a insurance summit in Kolkata organized by the Bengal Chamber of Commerce and Industry recently.

 

"It is also important for the industry to take a collective call to correct the aberrations that exist in terms of pricing…. This is one area where the industry needs a concerted effort to price risk and look at underwriting practices," he added. Insurers have so far been maintaining a register of policies and claims, in accordance with the provision of the insurance Act 1938. However, post amendments the Act has facilitated maintenance of such a register in electronic form too. 

The cost of insurance for aviation companies may rise if the Directorate General of Civil Aviation goes ahead with its plans to make it mandatory for pilots to undergo psychiatric test before takeoff as any failure to clear the test could lead to flight cancellations and claims. 

 

This might be just another burden for an industry already facing higher cost of insurance after a Malaysian Airlines flight vanished over South China Sea with 239 people aboard last year and due to accidents in the aviation industry. 

 

Airlines in India, mostly loss-making, may be squeezed further if the DGCA implements the plan. Insurance companies are yet to ascertain the liabilities of such an event since there is no available model to factor in such risks into a policy. 

 

"Initially, there will be loading, but based on experience in the first two years, there will be better understanding of the risk," said T. R. Ramalingam, head of underwriting at Bajaj Allianz General Insurance. 

 

Insurers are waiting for the final word on the mandatory test, which the DGCA is contemplating following the crash of the Germanwings aircraft in the French Alps last month, which killed at least 150 people. 

 

"There will be an increase in premium for pilot's loss of licence cover but reinsurance companies could look at it positively and reduce reinsurance rates," said Yogesh Lohiya, MD and CEO, Iffco Tokio General Insurance. 

The new service tax rate of 14% will come into effect from June 1, top government sources said, in a move that will make eating out in restaurants, insurance and phone bills expensive, among many other things. 

 

In his budget speech, Jaitley had said that to facilitate a smooth transition to levy of tax on services by both the Centre and the states, "it is proposed to increase the present rate" of service tax plus education cess from 12.36% to a consolidated rate of 14%. Service tax is levied on all services, expect a small negative list. Advertising, air travel, services of architect, certain type of constructions, credit card, even management, and tour operator are some of the important services which attract tax. 

With the Indian nuclear insurance pool falling short by Rs.600 crore, some foreign companies have shown an interest in being a part of the initiative. "We have pursued some overseas players and have received good response. 

 

Six companies came with Rs.150 crore. Now, it has become Rs.900 crore. We are putting all out effort into rising the remaining Rs.600 crore for operationalising the pool," said Y. Ramulu, GM of General Insurance Corporation (GIC) of India. 

  

Life Insurance Council has urged the regulator for 50% concession in re-insurance rate on Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), on account that its members face losses as the premium may not be sufficient to cover the cost. 

 

The council is also in the verge of  approaching the  states to waive stamp duty of $40 for improving the  viability of the scheme. Recently, out of 24 life insurance companies, 10 have joined the national programme, offering Rs.2 lakh sum assured in case of death of a policy holder on an annual premium of just Rs.350.

 

Insurance companies will get just about Rs.249 after deducting towards bank commission and stamp duty, which many believe is not going to cover the cost of insurance.

 

Banks that are mandated to sell the social security scheme have sold 2.5 crore life insurance policies since May Insurers will have to pay Rs.100 crore as stamp duty collectively.

 

Insurers have also expressed concerns over duplication of death claims and the council has engaged Credit Information Bureau (India) Ltd or Cibil to detect them. Cibil has built a database of 40 crore bank customers and 2.3 crore commercial loans, beside repository data of one crore mortgages. 

 

Life Insurance Council has urged the regulator for 50% concession in re-insurance rate on Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), on account that its members face losses as the premium may not be sufficient to cover the cost. 

 

The council is also in the verge of  approaching the  states to waive stamp duty of $40 for improving the  viability of the scheme. Recently, out of 24 life insurance companies, 10 have joined the national programme, offering Rs.2 lakh sum assured in case of death of a policy holder on an annual premium of just Rs.350.

 

Insurance companies will get just about Rs.249 after deducting towards bank commission and stamp duty, which many believe is not going to cover the cost of insurance.

 

Banks that are mandated to sell the social security scheme have sold 2.5 crore life insurance policies since May Insurers will have to pay Rs.100 crore as stamp duty collectively.

 

Insurers have also expressed concerns over duplication of death claims and the council has engaged Credit Information Bureau (India) Ltd or Cibil to detect them. Cibil has built a database of 40 crore bank customers and 2.3 crore commercial loans, beside repository data of one crore mortgages.

 

 

Life Insurance Corporation of India (LIC) is looking to collect at least Rs.31,000 crore as first year premiums from insurance product sales in 2015-16. Not only this it is also planning to  introduce five to seven new insurance products during the fiscal year according to LIC chairman S. K. Roy.

 

 

“We will introduce at least one new product in the Unit-linked space, one in the health insurance space and the rest in the traditional insurance space. Our new business premium collection target for the current fiscal is 13% higher than last financial year,” Roy reported.

 

 

With the soaring aim, LIC has taken steps to further advance its technology and processes to make transactions paperless for policyholders. It is also looking forward to expand its international operations and will soon form a joint venture to enter the insurance market in Bangladesh along with its Singapore operations to a full-fledged insurance business this financial year, Roy said.

 

Life Insurance Council is working hard towards making the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) attractive for its member companies apprehending its viability under the present pricing policy. Secretary General of the council V. Manickam said that, out of Rs.330 charged for the Rs.2 lakh sum assured, insurance companies are left with only about Rs.250 after deducting bank commission and stamp duty.

 

Apprehending the scheme's viability, the council has already written to industry regulator IRDAI seeking its intervention in getting 50 per cent rebate in current re-insurance rate of Rs.180 on this policy promoted by the centre. 

 

 

Life Insurance Corporation of India (LIC) reported a surplus of Rs.1,803.05 crore in FY 15, up 10.33 per cent over the previous year. The surplus in policy holders' accounts was reflected after paying an interim bonus of Rs.1,899.75 crore to its policy holders. 

 

Life Insurance Corporation of India has also proposed the entire surplus amount to be paid as its final dividend to the shareholder - the Union government. The LIC board approved the audited financial results in its meeting on June 9.

 

LIC's surplus was pushed up by a higher income from investments and lower commissions and operating expenses. Premium income grew marginally by 1.15 per cent to Rs.2.39 lakh crore.

 

While non-business recorded 3.8 per cent growth, linked life policies recorded a lower premium income declining from Rs.1.885 crore to Rs.1,314 crore. Profit booking on investments was the next major contributor, rising from Rs.3.908 crore or 16.75 per cent over the previous year to Rs.27.234 crore. Bulk of this income come from non-linked or traditional life policies.

 

These policies accounted for 75 per cent of the interest and dividend income and 66 per cent of the profit on sale redemption, almost in line with the previous year. LIC had a good year booking significant profit on scrips such as State Bank of India, Business Standard had reported recently. 

 

Loss on sale and redemption of investments also increased significantly, but on a low base. Such losses totalled Rs.1.051 crore, up 62 per cent from FY14. 

 

 

State owned reinsurer General Insurance Corporation Re has abandoned its expedition to buy a Lloyd's of London syndicate member and instead eyeing to apply for membership of the syndicate.

 

Experts believe that this will ruin the designated national reinsurer position in about 50 countries for a long time as it will take 18 months to get a licence and years to build a business.

 

"We are planning to apply for a licence to be part of the syndicate," said AK Roy, chairman and managing director of GIC Re. "We have called off our plans to buy a membership, which we pursued for over a year." Lloyd's of London is an insurance market in London's primary financial district the City of London.

 

GIC Re came very close to entering the Lloyd's of London market by acquiring Antares, owned by Lightyear Capital, but lost out to Qatar Insurance Company. Last year, it had acquired Johannesburg based Saxum Re to expand its global footprint. It has a joint venture reinsurance company in Bhutan.

 

One of the reasons for expanding globally is the shrinking of domestic business. Premium on insurance products is not adequately priced, leading to a decline in income from Indian business.

 

A survey by Bajaj Allianz General Insurance said although 75 per cent of respondents were aware that home insurance was essential, only 30 per cent had home insurance for either their home or its contents.

 

While most Indians are aware about the risks around earthquakes and natural calamities for their houses, they still do not purchase home insurance.

 

 

 

Life Insurance Corporation of India (LIC) will recruit 5,066 people for the post of Apprentice Development Officers in its various zonal offices. The total number of vacancies, including those on the reserved category, may increase or decrease and the selection will be based on an online examination and interviews. 

 

As per the notification given by LIC the total number of vacancies varies according to zones. Graduates in any discipline or a Fellow of the Insurance Institute of India, Mumbai are eligible to apply. The upper age limit is 30 for general candidates, 42 for LIC employees and 37 for its agents. Upper age limit is relaxed for reserved categories, according to existing norms. 

The Securities Appellate Tribunal (SAT) has adjourned an appeal against the IRDAI  in a hearing between SBI Life and the Insurance Regulatory and Development Authority of India (IRDAI). 

 

The case relates to a Rs.275 crore refund order the insurance regulatory passed against the life insurer. It had asked SBI Life to refund this policy amount to all policy holders who had purchased it in the past on grounds of irregularities in the way it was sold to customers. The case has been adjourned till September 2. 

 

IRDA AGENTS EXAM: Mock Test Questions for 50 hours exam (IC33) - Part 2

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Created on 15 September 2012 Published Date

Attempt IRDA Mock test Questions for IRDA Insurance Agents Exam from IC33 from The Insurance Times. Extracts from Question/Answer Book published by Sashi Publications, Kolkata. Refer the book for detailed questions on each chapter. www.sashipublications.com  (Answers are marked in Bold)

Q. In which Insurance plan, the insurance company pays the fund value (or in some cases the fund value and sum insured) as the maturity claim, at the end of the plan’s term.

A)   Money back policy         B)   Return of premium

C)   Endowment plan             D)   ULIP

 

Q.   A claim under a term insurance policy is submitted by an individual who has substantially understated his age.           As an alternative to paying out the full claim the insurer is most likely to take what action?

A)   Deduct the underpaid premiums from the sum insured.

B)   Make the policy paid up.

C)   Pay out the surrender value.

D)   Reject the claim on the grounds of misrepresentation

 

Q. Under which section of the Insurance act, 1938 stipulates no insurance agent can be refused payment of renewal commission due to him on renewal premium, in respect of life insurance business conducted in India under the agreement.

A)   Section 41(1)                  B)   Section 40(1)

C)   Section 40A(1)                D)   Section 44

 

Find the odd man out:

Q. Under married women’s Property Act 1874 the proposer should be

A)   A married man                B)   A divorced man

C)   An unmarried man D)   A widowed man

 

Q. Find the odd man out

Which of the following issues the central Government Provides to the IRDA

A)   Rules for carrying out the provisions of the act.

B)  Grants

C)  Returns, Statements and particulars on program.

D)   Directions on questions of policy.

 

Q. The Reserve bank of India was set up in the year?

A)  1st April 1949                 B)              1st April 1934

C)  1st April 1935 D)   1st April 1951

 

Q. An award made by the Insurance Ombudsman will only be binding on the insurer if the

A)   Complainant accepts this decision.

B)   Consumer Forum is involved in the case.

C)   Insurer signs a disclaimer.

D)   Value of the award is less than 2lakhs.

 

Q.   The Governing body has set up ———— number of offices across the country in order to expedite the disposal of complaints?

A)   10                                  B)   20

C)   20                                  D)   12

Find the odd man out:

Q. The code of conduct followed by the every insurance agent, shall

A)   Identify himself and the insurance company of whom he is an insurance agent.

B)   Disclose his license to the prospect on demand.

C)   Induce the prospect to submit wrong information in the proposal form or documents submitted to the insurer for acceptance of the proposal.

D)   Disclose the scales of commission in respect of the insurance product offered for sale, if asked by the prospect.

 

Q.   From the following which statement is correct:-

a.   Perils refers to wear and tear of assets

b.   Insurance is done only when there is certainty of occurrence of loss

c.   Both Correct

d.   Both Wrong

 

Q.   From the following which statement is correct:-

a.   The risk of insurance is distributed only on the insureds facing the risk of same kind.

b.   The loss of insurance is paid from the premium collected from the particular insured

c.   Both Correct

d.   Both Wrong

 

Q.   Insurance pays loss to the insured on exhaustion of its value

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   Perils refers to wear and tear of assets

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   Underwriter can have assistance of _________ report for life insurance proposal

A. Actual

B. Physical

C. medical

D. Mental

E. None of above

 

Q.   The adverse selection of lives in insurance scheme is resorted by _____________of material facts

A. Expression

B. Depression

C. suppression

D. Revelation

E. None of above

 

Q.   All risks are insurable

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   Insurance Act 1938 contain the definition of insurable interest

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

Q.   Risk evaluation method helps to measure frequency of losses.

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   The loss caused by earthquakes & floods are of Low frequency and high severity

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   Strict enforcement of No smoking regulations may prevent fire losses.

A. Statement is correct

B. Statement is not correct

C. Statement is partially correct

D. Statement is partially wrong

E. None of above

 

Q.   Ombudsman works as a part of a

A. Ministry of legal affairs

B. Supreme Court

C. High Court

D. IRDA

E. None above


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