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English Mock Test Chapter 9

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Question 1
What is the objective behind Mortgage Redemption Insurance?
A
Provide financial protection for home loan borrowers
B
Facilitate cheaper mortgage rates
C
Protect value of the mortgaged property
D
Evade eviction in case of default
Question 2
The sum assured under keyman insurance policy is generally linked to which of the following?
A
Keyman income
B
Business history
C
Business profitability
D
Inflation index
Question 3
Mortgage redemption insurance (MRI) can be categorised under ________.
A
Increasing term life assurance
B
Variable life assurance
C
Universal life assurance
D
Decreasing term life assurance
Question 4
Which of the below losses are covered under keyman insurance?
A
Property theft
B
Losses related to the extended period when a key person is unable to work
C
General liability
D
Losses caused due to errors and omission
Question 5
A policy is effected under the MWP Act. If the policyholder does not appoint a special trustee to receive and administer the benefits under the policy, the sum secured under the policy becomes payable to the _____________.
A
Official Trustee of the State
B
Next of kin
C
Insurer
D
Insured
Question 6
Mahesh ran a business on borrowed capital. After his sudden demise, all the creditors are doing their best to go after Mahesh’s assets. Which of the below assets is beyond the reach of the creditors?
A
Property under Mahesh’s name
B
Mahesh’s bank accounts
C
Term life insurance policy purchased under Section 6 of MWP Act
D
Mutual funds owned by Mahesh
Question 7
Which of the below option is true with regards to MWP Act cases? Statement I: Maturity claims cheques are paid to policyholders Statement II: Maturity claims cheques are paid to trustees
A
I is true
B
II is true
C
Both I and II are true
D
Neither I nor II is true
Question 8
Which of the below option is true with regards to MWP act cases? Statement I: Death claims are settled in favour of nominees Statement II: Death claims are settled in favour of trustee
A
I is true
B
II is true
C
Both I and II are true
D
Neither I nor II is true
Question 9
Ajay pays insurance premium for his employees. Which of the below insurance premium will not be treated deductible as compensation paid to employee? Choice I: Health insurance with benefits payable to employee Choice II: Keyman life insurance with benefits payable to Ajay
A
I only
B
II only
C
Both I and II
D
Neither I nor II
Question 10
The practice of charging interest to borrowers who pledge their property as collateral but leaving them in possession of the property is called _____________.
A
Security
B
Mortgage
C
Usury
D
Hypothecation
Question 11
Which of the below policy can provide protection to home loan borrowers?
A
Mortgage Redemption Insurance
B
Life Insurance
C
Disability Insurance
D
General Insurance
Question 12
Beneficiary under section 6 of MWP act can be
A
Wife alone
B
Wife and one or more children jointly
C
One or more children
D
All the above
Question 13
"Which of the following is ture I) Under MWP Act the policy is deemed to be a Trust II) In case of a policy under MWP Act the maturity amount will be paid to the husband."
A
I is correct
B
II is correct
C
Both are correct
D
Both are wrong
Question 14
In the case of policy under MWP Act which of following is not possible
A
Nomination in the policy.
B
Surrender of the policy.
C
Creditors asking for policy money.
D
All of above.
Question 15
In the case of Keyman Insurance which of the following policies can be given.
A
Money back policy.
B
Term Insurance Policy.
C
ULIP
D
Endowment Policy.
Question 16
Who can be a key person in a co. eligible for Keyman Insurance ?
A
Director of the co.
B
A partner
C
A key sales person
D
All of the above.
Question 17
Which of the following is correct I) Keyman Insurance is for protection of business less. II) Keyman Insurance is for protection of Keyman's individual income.
A
I is correct.
B
II is correct.
C
Both are correct.
D
Both are wrong.
Question 18
The objective behind the Mortgage Redemption Insurance is
A
Facilitate cheaper mortgage rates.
B
Protect value of the mortgaged property.
C
Provide financial protection for home loan borrowers.
D
Evade eviction in case of default.
Question 19
In Mortgage Redemption Insurance, the premium ____________________ during the term.
A
Increases
B
Decreases
C
Remains same
D
None of the
Question 20
In case of Keyman Insurance, if the key person dies, then the benefit is paid to _____________________________
A
Keyman's family
B
Employees of the company.
C
The Company
D
All of the above
Question 21
Death benefit in Keyman Insurance is_______________________
A
Taxable for company.
B
Tax will be paid by Keyman's family.
C
No tax (Not taxable
D
Tax will be paid by employee.
Question 22
In a MWP policy the beneficiaries under the plan, other than wife can be
A
Children
B
Siblings
C
Ex- wife
D
Parents
Question 23
Under MWP act 1874 a policy holder is __________________________________
A
The life Assured
B
The Beneficiaries
C
The Trustee
D
The administrator
Question 24
MWP Act 1874, provides that a life Insurance policy that has been taken out by_____________________________
A
Married man
B
Married Woman
C
Married Son
D
Married Daughter
Question 25
As per MWP Act 1874, policy once registered under the act, can be controlled by _____________________
A
The Court
B
Life to be insured
C
The creditors
D
None of the above
Question 26
Rahul is married to Ranjana and have daughter Ruchi, aged 14 yrs. who can become trustee as per MWP Act 1874
A
Ranjana, wife of Rahul
B
Ranjana & Ruchi
C
Both the above
D
None of the above
Question 27
Which of the following is true in connection with MWP Act 1874,
A
life insurance policy can be assigned
B
Life insurance policy can have nominees
C
Life insurance policy can be surrendered
D
None of the above
Question 28
As per MWP Act 1874, Life insurance policy can be taken for the benefit of _____________________
A
Parents
B
Sister
C
Brother
D
Wife &/or Children
Question 29
Which of the following is true in connection with MWP Act 1874?
A
Rajiv, married man can become beneficiary in life insurance policy
B
Grand Parents can become proposer for the benefit of Grand Children
C
Nomination & Assignment cannot be done
D
None of the above
Question 30
If the employer has insurable interest in the life of an employee, what kind of policy is this
A
Key-Man Insurance
B
Surety Insurance
C
Partnership Insurance
D
Debtor Insurance
Question 31
A company has an Insurable Interest in the lives of certain important persons in the company. The Company can take out this Insurance on the lives of such people and such an insurance cover is called ______________________.
A
Key – Man Insurance
B
Vital Insurance
C
Liability Insurance
D
Consequential Loss insurance
Question 32
ABC Co.Ltd takes out Key Man insurance on the life of Mr.Amit, Director of the company for SA of Rs.1 Crore. Upon the death of Mr.Amit, ABC Co.Ltd followed losses of Rs.10 crores. What amount of claim will be settled?
A
To the extent of Loss occurred
B
To the extent of SA
C
To the extent of income of Mr.Amit
D
None of the above
Question 33
In case of Key Man Insurance, death claim will be payable to ______________
A
The family of Deceased
B
The employees of the company
C
The company
D
All of the above.
Question 34
In case of Key Man Insurance, premiums are paid by ____________________
A
The Employer
B
The Employee
C
Insurer
D
None of the above
Question 35
In case of Key Man Insurance, which of the following is incorrect
A
Death Benefit is Tax free
B
Death Benefit is Taxable
C
Premium paid is an business expense to employer
D
None of the above
Question 36
Premiums paid by employer in case of Key Man Insurance are _______________________
A
Profit for the company
B
Salary paid to Employee
C
Bonus to the company
D
Entire premium is treated as business expense
Question 37
Mortgage Redemption Insurance is mainly _______________________
A
Decreasing Term Plan
B
Money Back Policy
C
Pension Plan
D
Unit Linked Insurance Plan
Question 38
Mortgage Redemption Insurance will pay claim in case of ____________________
A
Demise of mortgagor without payment of loan
B
Maturity of Policy
C
Policy lapsation
D
Full payment of loan
Question 39
Life insured under Mortgage Redemption Insurance will be _____________________
A
Borrower of Loan
B
Loan provider
C
Guarantor
D
None of the above
Question 40
In case of Mortgage Redemption Insurance, Death Claim will be _________________________
A
Sum Assured
B
Balance on mortgage loan
C
50% of Sum assured
D
Sum assured plus Bonus
Question 41
In case of Mortgage Redemption Insurance, Sum Assured will be to maximum of ______________________
A
Loan Amount
B
Income of mortgagor
C
None of Above
D
Both of Above
Question 42
If a policy under MWP act is effected to defraud creditors. Which of the below is correct?
A
Protection under MWP will work
B
Protection under MWP will not work
C
Protection is not related to intentions
D
Protection under MWP May not work
Question 43
A person has taken a policy under MWP Act for the benefit of his spouse and children. Here the trustee can be __________________
A
Spouse or children(Major)
B
Bank
C
Any person appointed by the Policy holder
D
All the above
Question 44
Who is the life assured in a policy created under MWP act?
A
Married Man
B
Male Divorcee
C
Widower
D
All of the above.
Question 45
A Policy was taken under MWP Act from XY company in Tamilnadu, but trustee was not appointed. The family has move to Delhi. If a claim arises under the policy at Delhi, then it will be paid to ___________________
A
Official trustee of Tamilnadu
B
Official trustee of Delhi
C
Official trustee of Mumbai(Head Office of XYZ company)
D
None of the above.
Question 46
Under any circumstances, can a policy taken under MWP Act be surrendered?
A
If one of the beneficiaries is major
B
If all the beneficiaries are major
C
If the trustee is Major
D
Cannot surrender under any circumstances
Question 47
If a person is self-employed and does not have any employee, can he take key man insurance?
A
Yes
B
If required
C
May be
D
Not possible
Question 48
An employer has taken Key Person Insurance on the health of an employee, which of the below sentences is/are correct.
A
Employer will receive the treatment cost and will spend for the employee
B
Employer will receive a fixed amount for his business
C
Employee will receive the treatment cost directly
D
All the above
Question 49
Which of the following is not correct, when a claim under MRI is initiated?
A
The money is paid to the borrower and he has to repay to the creditor
B
MRI and term insurance does not give the same benefits
C
The money is paid to the mortgagor directly
D
The money paid is equal to the outstanding loan amount
Question 50
_______________ can be described as an insurance policy taken out by a business to compensate that business for financial losses that would arise from the death or extended incapacity of an important member of the business.
A
Joint Life Insurance
B
MRI
C
Credit Life Insurance
D
Keyman Insurance
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