Sample Questions

IC 72 Motor Insurance Mock Tests — 5 random MCQs with answers & explanations

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These 5 questions are randomly selected (standard MCQs only, not case-based).

Q1 What is the formula for calculating 'Loss Ratio' in motor insurance accounting?

  • A. (Total Expenses ÷ Total Gross Premium) × 100
  • B. (Net Profit ÷ Total Assets) × 100
  • C. (Total Incurred Claims ÷ Total Earned Premium) × 100 Correct Answer
  • D. (Agent Commission ÷ Net Premium) × 100
Explanation:
Loss Ratio expresses claim expenses as a percentage of earned premium: (Incurred Claims ÷ Earned Premium) × 100.

Marks: 1

Q2 What administrative fee is recoverable by an insurer when issuing a duplicate Cover Note or Certificate of Insurance under GR 26?

  • A. Rs. 100
  • B. Rs. 50 Correct Answer
  • C. Rs. 25
  • D. Rs. 200
Explanation:
Under General Regulation 26 of the India Motor Tariff, a duplicate Certificate of Insurance or Cover Note is issued on remittance of Rs. 50 towards administrative charges.

Marks: 1

Q3 If a vehicle has an LPG or CNG kit installed with RTA approval, what is the extra premium charged to cover the kit?

  • A. 4% of the kit's value Correct Answer
  • B. 6% of the kit's value
  • C. 8.5% of the kit's value
  • D. A flat fee of Rs. 500
Explanation:
To insure an external bi-fuel kit (like CNG), you must pay an additional premium equal to 4% of the value of that specific kit.

Marks: 1

Q4 Which schedule in the Motor Vehicle Act 1988 provides the method for calculating compensation for fatal accidents?

  • A. Schedule 1
  • B. Schedule 2 Correct Answer
  • C. Schedule 3
  • D. Schedule 4
Explanation:
Schedule 2 of the Act contains the specific tables and methods used to calculate money owed for deaths, based on the person's age and income.

Marks: 1

Q5 In IIBI underwriting policy datasets, what is the 'TAC Make Code'?

  • A. The pin code of the vehicle owner's residence
  • B. A standardized numerical code allotted by TAC/IIBI for specific vehicle makes and models (e.g. Maruti Omni 8-seater = Code 10018) Correct Answer
  • C. The serial number of the vehicle's battery
  • D. The engine horsepower rating multiplied by 10
Explanation:
TAC Make Code is a standardized system of unique numerical codes assigned to specific vehicle makes, models, and sub-variants across the industry.

Marks: 1

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