Insurance in India

Q1.Consider the following statements regarding key insurance concepts: 1. Assurance guarantees financial coverage against a short-term uncertain event which might not necessarily happen. 2. Insurance Density is measured as the Total Insurance Premium as a percentage of GDP. 3. Insurance Penetration is calculated as the ratio of premium to the total population. How many of the above statements are correct?

Q2.With reference to the insurance sector in India, consider the following statements: 1. Surveyors and Third-Party Administrators are insurance intermediaries primarily involved in the procurement of new business for insurance companies. 2. Bankassurance is a partnership model where an insurance company is permitted to sell banking products to its existing client base. 3. Individual agents, corporate agents, and insurance brokers are all required to be licensed by the Insurance Regulatory and Development Authority (IRDA). How many of the above statements are correct?

Q3.Consider the following statements: Statement-I: A standard life insurance policy can be categorized as a form of 'Assurance'. Statement-II: Assurance provides financial coverage for an event that is certain to happen, while Insurance provides coverage for an event that is uncertain. Which one of the following is correct in respect of the above statements?

Q4.Consider the following statements with reference to the provided data on the insurance sector: 1. In 2022, India's life insurance penetration was higher than the world average for life insurance. 2. In 2022, India's total insurance density was greater than the world average for life insurance density. 3. India's total insurance penetration showed an increase from 2022 to 2023. How many of the above statements are correct?

Q5.Consider the following statements: Statement-I: The insurance sector's contribution to economic growth is exclusively through the mobilisation of savings into long-term investments. Statement-II: Insurance enables companies and entrepreneurs to undertake informed risks by mitigating potential losses, which in turn fosters innovation. Which one of the following is correct in respect of the above statements?

Q6.Consider the following statements regarding the nationalisation of the insurance sector in India: 1. The Life Insurance Company (LIC) was formed in 1956 by merging over 100 private sector insurance companies. 2. The General Insurance Business (Nationalisation) Act, 1972, led to the nationalisation of the life insurance business in India. 3. The General Insurance Corporation (GIC) was originally incorporated with four subsidiary companies after the nationalisation of general insurance. How many of the above statements are correct?

Q7.With reference to recent reforms in the Indian insurance sector, consider the following statements: 1. The General Insurance Business (Nationalisation) Amendment Act, 2021, mandates that the Central Government must hold at least 51 per cent of the equity capital in a specified insurer. 2. The Insurance (Amendment) Bill, 2021, specifies that at least half of the directors on the board of an Indian insurance company must be independent directors. 3. As per the Insurance (Amendment) Bill, 2021, all key management persons in an Indian insurance company must be resident Indians. How many of the above statements are correct?

Q8.Consider the following statements regarding the IRDAI (Trade Credit Insurance) Guidelines, 2021: 1. These guidelines are applicable to all insurers transacting general insurance business, including the Export Credit Guarantee Corporation (ECGC). 2. The guidelines permit trade credit insurance policies to cover losses for banks and factoring companies arising from non-receipt of payment from a buyer due to commercial or political risks. 3. A key objective of these guidelines is to facilitate general insurance companies in helping businesses manage country risk and access new markets. How many of the above statements are correct?

Q9.Consider the following statements: Statement-I: The General Insurance Business (Nationalisation) Amendment Act, 2021, is intended to accomplish higher private participation in public sector insurance companies. Statement-II: The Malhotra Committee, established in 1993, had recommended bringing down the Government's share in insurance companies to 50 per cent. Which one of the following is correct in respect of the above statements?

Q10.With reference to the Indian insurance sector, consider the following statements: 1. Insurance penetration is measured as the ratio of total insurance premium to the country's population. 2. In the financial year 2023-24, both insurance penetration and insurance density in India witnessed a decline compared to the previous year. 3. The insurance sector facilitates economic development by providing long-term funds for infrastructure projects. How many of the above statements are correct?

Q11.Consider the following statements: Statement-I: In the financial year 2024, India's overall insurance penetration declined, while its overall insurance density increased. Statement-II: Insurance penetration is calculated as a percentage of the Gross Domestic Product (GDP), whereas insurance density is calculated as a per capita premium. Which one of the following is correct in respect of the above statements?

Q12.Consider the following statements regarding the structure of the Indian insurance sector: 1. The number of general insurers is greater than the number of life insurers. 2. Specialised insurers are entities that focus on providing reinsurance and financial backing to other insurance companies. 3. The combined contribution of banking and insurance services to India's GDP is approximately 7 per cent. How many of the above statements are correct?

Q13.Consider the following statements regarding key insurance metrics: 1. Insurance penetration is calculated as the ratio of the total insurance premium collected in a country to its total population. 2. Insurance density is expressed as the percentage of the total insurance premium collected in a country relative to its Gross Domestic Product (GDP). 3. The Standing Committee on Finance has recommended a reduction in the Goods and Services Tax (GST) rate on health insurance products. How many of the above statements are correct?

Q14.Consider the following statements: Statement-I: The Insurance Regulatory and Development Authority of India (IRDAI) allows insurance companies to obtain a composite license for providing life, general, and health insurance under a single entity. Statement-II: The Standing Committee on Finance recommended the introduction of composite licensing to reduce costs and compliances for insurers. Which one of the following is correct in respect of the above statements?

Q15.Consider the following statements regarding Domestic Systemically Important Insurers (D-SIIs): Statement-I: D-SIIs are subjected to additional regulatory measures and enhanced supervision by the insurance regulator. Statement-II: The perception of D-SIIs as 'too big or too important to fail' reduces moral hazard by encouraging prudent risk-taking and strengthening market discipline among these insurers. Which one of the following is correct in respect of the above statements?

Q16.Consider the following statements regarding social security schemes in India: 1. The Aam Aadmi Bima Yojana is implemented by the Department of Financial Services under the Ministry of Finance. 2. The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is available to people between 18 and 70 years of age. 3. The premium for the Aam Aadmi Bima Yojana is shared equally between the insured person and the Central Government. How many of the above statements are correct?

Q17.Consider the following statements: Statement-I: The implementation cost of Ayushman Bharat - Pradhan Mantri Jan Arogya Yojana (PM-JAY) is shared between the Central and State Governments. Statement-II: PM-JAY is a fully Government-funded health insurance programme with no premium contribution from the beneficiary households. Which one of the following is correct in respect of the above statements?

Q18.Consider the following statements regarding insurance institutions and regulations in India: 1. The Deposit Insurance and Credit Guarantee Corporation (DICGC) insures all bank deposits, such as savings and fixed deposits, without any upper monetary limit for each depositor in a bank. 2. The Agriculture Insurance Company of India Limited (AICIL) is wholly owned by NABARD and the General Insurance Corporation of India (GIC). 3. As per IRDAI (Micro Insurance) Regulations, 2015, the sum assured under a microinsurance product offering health benefits cannot exceed ₹5,00,000. How many of the above statements are correct?

Q19.With reference to recent reforms in the regulatory framework for the insurance sector in India, consider the following statements: 1. Any member of the Insurance Regulatory and Development Authority of India (IRDAI) board is empowered to order searches and seizures. 2. The Net Owned Fund requirement for foreign reinsurance branches has been significantly reduced to deepen the market. 3. Public sector insurers have been granted greater autonomy to open new offices without prior government approval. Which of the statements given above is/are correct?

Q20.With reference to the development of India's corporate bond market, consider the following statements: 1. India's corporate bond market, as a percentage of GDP, is significantly smaller than that of several other major economies like the United States and South Korea. 2. A greater reliance on bank-centric financing for long-term projects strengthens the transmission mechanism of monetary policy. 3. The introduction of instruments like Total-Return Swaps allows investors to gain economic exposure to corporate bonds without requiring direct ownership of the underlying asset. How many of the statements given above are correct?

Q21.With reference to the fundamental concepts and structure of the Indian insurance sector, consider the following statements: 1. Insurance penetration is a measure of the total insurance premiums as a percentage of the country's Gross Domestic Product (GDP). 2. Insurance density represents the per capita premium, and an increase in this metric signifies a higher average insurance expenditure per person. 3. The structure of the Indian life insurance market includes a single public sector insurer alongside multiple private sector insurers. How many of the statements given above are correct?

Q22.With reference to the key metrics used to evaluate the insurance sector in India, consider the following statements: 1. Insurance penetration is defined as the ratio of total insurance premiums to the country's total population. 2. In recent years, the insurance penetration for the life insurance industry has consistently remained higher than that of the non-life insurance industry. 3. An increase in insurance density indicates a rise in the average insurance premium paid per capita. How many of the statements given above are correct?

Q23.With reference to the performance and health of India's Scheduled Commercial Banks (SCBs), consider the following statements: 1. There has been a substantial increase in credit extended to the agricultural sector over the past few financial years. 2. The asset quality of SCBs, as indicated by the Gross Non-Performing Assets (GNPA) ratio, has seen significant improvement, showing a consistent downward trend over a multi-year period. 3. Bank credit to the industrial sector is a significant component of their lending portfolio, and its growth is considered a driver for industrial expansion. Which of the statements given above is/are correct?

Q24.Examine the following statements regarding the Banking, Financial Services, and Insurance (BFSI) sector in India: Statement-I: The banking sector plays a crucial role in capital market development by linking savers and corporate entities seeking long-term funds. Statement-II: The Reserve Bank of India is the principal regulator for all primary market fund mobilisation activities, including Initial Public Offerings and corporate bond issuances. Which one of the following is correct in respect of the above statements?

Q25.With reference to household financial savings and the insurance sector in India, consider the following statements: 1. The share of life insurance and provident funds in the composition of new household financial assets has remained largely stable in recent years. 2. Insurance penetration, a measure of insurance premiums as a percentage of GDP, has seen a continuous increase over the past few years. 3. Within the Indian insurance sector, the number of 'General Insurers' is greater than the number of 'Life Insurers'. Which of the statements given above is/are correct?

Q26.Consider the following statements regarding the macroeconomic implications of rising household financial liabilities in India: 1. An increase in the household debt-to-GDP ratio is consistently associated with a long-term acceleration in real GDP growth. 2. The growth of household financial assets has been outpacing the growth of household financial liabilities in recent years. 3. A rising share of unsecured consumption loans within household debt can increase the vulnerability of the financial sector. Which of the statements given above is/are correct?

Q27.A sustained trend where the growth of a country's household financial liabilities significantly outpaces the growth of its household financial assets has several implications. Consider the following potential consequences of such a trend: 1. It indicates an increasing credit dependence within the household sector. 2. It generally leads to a weakening of household balance sheets, despite potentially easier access to credit. 3. It enhances the household sector's resilience to unexpected economic shocks. How many of the statements given above are correct?