Question 1

The Insurance Regulatory and Development Authority (IRDAI) was established in which year and is headquartered in which city?

Accepted Answer

Source: IRDA Act, 1999. The IRDAI was established on 1st April 1999 as a statutory body to regulate and develop the insurance sector in India. Its headquarters is located in Hyderabad, Telangana.

Question 2

Under the IRDA Act, 1999, which of the following is NOT a primary function of the IRDAI?

Accepted Answer

Source: IRDA Act, 1999, Sections 14-15. The primary functions of IRDAI include: (1) issuing licenses to insurers, (2) regulating tariffs and premiums, (3) protecting policyholders' interests, (4) promoting insurance awareness, and (5) regulating insurance intermediaries. Setting interest rates for bank deposits is a function of the Reserve Bank of India (RBI), not IRDAI.

Question 3

The Insurance Ombudsman scheme in India is designed to resolve policyholder complaints up to a claim value limit of _______ rupees.

Accepted Answer

Source: IRDAI Insurance Ombudsman Regulations, 2020 (amended 2023). The Insurance Ombudsman has jurisdiction to entertain complaints where the amount in question does not exceed Rs. 30 lakhs (30,00,000). This limit was increased from Rs. 20 lakhs to Rs. 30 lakhs effective from 1st January 2023.

Question 4

Which section of the Insurance Act, 1938 specifically governs the repudiation of life insurance claims by insurers?

Accepted Answer

Source: Insurance Act, 1938, Section 45. Section 45 of the Insurance Act, 1938 deals with the repudiation of life insurance claims. It stipulates that an insurer cannot repudiate a life insurance claim on the ground of misstatement or non-disclosure after the policy has been in force for 2 years (or 3 years for policies issued before 1st December 2015). This is a critical consumer protection provision.

Question 5

Under Section 39 of the Insurance Act, 1938, a policyholder can nominate a person to receive policy proceeds. Which of the following statements about nomination is CORRECT?

Accepted Answer

Source: Insurance Act, 1938, Section 39. Section 39 permits a policyholder to nominate one or more persons to receive the policy proceeds in the event of the policyholder's death. The nomination can be changed or cancelled by the policyholder at any time before the maturity or death of the policyholder, by giving written notice to the insurer.

Question 6

IRDAI has mandated that life insurance policies must have a minimum lock-in period before the policyholder can exercise the surrender option. What is this minimum lock-in period?

Accepted Answer

Source: IRDAI Master Circular on Life Insurance Product Guidelines, 2023. Life insurance policies are required to have a minimum lock-in period of 3 years from the date of issuance. During this period, the policyholder cannot surrender the policy. After 3 years, the policyholder is entitled to exercise the surrender option and receive the guaranteed surrender value as per IRDAI regulations.

Question 7

Under IRDAI guidelines, the Insurance Ombudsman can entertain complaints up to what maximum claim amount?

Accepted Answer

Source: IRDAI Insurance Ombudsman Regulations 2020. Explanation: The Insurance Ombudsman has jurisdiction to entertain complaints where the amount of claim does not exceed ₹30 lakhs (₹3,000,000). This limit was revised upward from ₹20 lakhs in 2020 to enhance consumer access to the ombudsman mechanism.

Question 8

Which of the following is NOT a core function of IRDAI as per the IRDA Act 1999?

Accepted Answer

Source: IRDA Act 1999, Sections 14-16. Explanation: IRDAI's core functions include: (1) issuing licenses to insurers, (2) regulating insurance business and tariffs, (3) protecting policyholders' interests, (4) promoting insurance awareness, and (5) ensuring solvency of insurers. Direct investment in insurance companies or managing insurance funds is NOT a core IRDAI function — these are functions of insurers themselves.

Question 9

Under Section 45 of the Insurance Act 1938, what is the minimum period after which a life insurance policy cannot be repudiated by the insurer on the ground of misstatement?

Accepted Answer

Source: Insurance Act 1938, Section 45. Explanation: Section 45 of the Insurance Act 1938 provides that after 3 years from the date of issuance of a life insurance policy, the insurer cannot repudiate the policy on the ground of any misstatement, omission, concealment, or fraud in the proposal or declaration, except in cases of fraud. This is a critical consumer protection provision.

Question 10

IRDAI was established in which year, and what is its headquarters location?

Accepted Answer

Source: IRDA Act 1999. Explanation: The Insurance Regulatory and Development Authority (IRDAI) was established on September 26, 1999, under the IRDA Act 1999. Its headquarters is located in Hyderabad, Telangana. IRDAI is a statutory body responsible for regulating and developing the insurance sector in India.

Question 11

Which section of the Insurance Act 1938 governs the nomination of beneficiaries in insurance policies?

Accepted Answer

Source: Insurance Act 1938, Section 39. Explanation: Section 39 of the Insurance Act 1938 specifically deals with nomination. A policyholder can nominate one or more persons to receive policy proceeds. The nomination can be changed at any time before maturity or surrender of the policy.

Question 12

Under IRDAI regulations, what is the maximum claim settlement period for non-life insurance claims after receipt of all required documents?

Accepted Answer

Source: IRDAI Regulation 2016 (Non-Life Insurance Claims). Explanation: IRDAI mandates that non-life insurers must settle claims within 30 days of receipt of all required documents. This is a core consumer protection measure to ensure timely claim resolution.

Question 13

Under IRDAI Guidelines on Grievance Redressal, what is the maximum time period within which an insurance company must acknowledge receipt of a complaint filed by a policyholder?

Accepted Answer

Source: IRDAI Grievance Redressal Guidelines 2023. Explanation: Insurance companies must acknowledge receipt of a complaint within 1 working day of receiving it. This acknowledgment must include the complaint reference number, date of receipt, and expected timeline for resolution. The acknowledgment requirement ensures transparency and allows policyholders to track their grievance status.

Question 14

Under IRDAI Investment Guidelines, what is the maximum percentage of investable funds that a life insurance company can allocate to equity and equity-linked securities combined?

Accepted Answer

Source: IRDAI Investment Guidelines 2023. Explanation: Life insurance companies are permitted to invest up to 35% of their investable funds in equity and equity-linked securities. This limit is designed to balance growth potential with the need for capital preservation given the long-term liability profile of life insurance business. The guideline applies uniformly to all life insurers and is reviewed periodically by IRDAI.

Question 15

Under Section 64V of the Insurance Act 1938, what is the minimum solvency margin requirement for life insurance companies in terms of percentage of net premium income or net liabilities, whichever is higher?

Accepted Answer

Source: Insurance Act 1938, Section 64V read with IRDAI Solvency Norms Regulations 2023. Explanation: Life insurance companies must maintain a minimum solvency margin of 150% of the required solvency capital. The required solvency capital is calculated as the higher of (i) 3% of net premium income or (ii) 10% of net liabilities. This ensures that insurers maintain adequate capital buffers to meet policyholder obligations even under adverse scenarios.

Question 16

Under IRDAI Regulations, what is the maximum tenure for which an Insurance Ombudsman can serve, and what is the mandatory cooling-off period before reappointment?

Accepted Answer

Source: IRDAI Insurance Ombudsman Scheme 2020. Explanation: An Insurance Ombudsman is appointed for a tenure of 3 years and is eligible for reappointment for a second term of 3 years. However, there is a mandatory cooling-off period of 3 years after completion of two consecutive terms before the same person can be reappointed. This ensures independence and prevents institutional capture.

Question 17

Under IRDAI Regulations on Tied Agent Tie-up, what is the maximum number of insurance companies (both life and general) that a single tied agent can represent simultaneously?

Accepted Answer

Source: IRDAI Tied Agent Regulations 2023. Explanation: A tied agent can represent a maximum of 2 insurance companies simultaneously — either 2 life insurers, or 2 general insurers, or 1 life insurer and 1 general insurer. This restriction is designed to prevent conflicts of interest and ensure that agents maintain adequate focus and service quality for each principal insurer.

Question 18

Under Section 38 of the Insurance Act 1938, when an insurance policy is assigned, what is the mandatory requirement regarding notice to the insurer?

Accepted Answer

Source: Insurance Act 1938, Section 38. Explanation: Section 38 governs the assignment of insurance policies. While assignment can occur by operation of law or by act of parties, the Act does not mandate written notice to the insurer for the assignment to be valid between the assignor and assignee. However, the assignee's rights against the insurer are only protected from the date the insurer receives written notice of the assignment. This creates a distinction between validity of assignment and enforceability against the insurer.

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