Most Asked Insurance Interview Questions and Answers
What is the different type of Life Insurance?
There are two type of life insurance
a) Term Life Insurance :
Term life Insurance is a type of life Insurance, which provides coverage for fixed rate of premium for a limited period of time. Term Insurance can cover you for the term of one or two years.
b) Permanent Life Insurance:
Permanent Life Insurance coversan individual for the whole life; people take permanent life insurance about 25-30 years normally. The premiums are slightly higher than Term Life Insurance.
What is a ‘PLPD’ insurance stand for?
PLPD stands for ‘personal liability and property damage’. Personal liability covers when an individual cause injury to others in an accident while property damage is done when any property get damaged. In both, the injured party or third party will claim for insurance money from the insurance company of the offender.
What is the difference between “revocable beneficiary” and “irrevocable beneficiary”?
‘Revocable beneficiary’ designation gives right to the policy holder to change the beneficiary name without the consent of the named beneficiary. While in ‘Irrevocable beneficiary’ the policy holder has to take consent of the beneficiary before the name is changed.
Is it possible to get the full payment on cancelling the new policy in free look period?
‘Free Look Period’ is a time-period where the insured can cancel their newly bought policy in a specific period of time from the date of issuing the policy without any penalties or surrender charges.
Yes, it is possible to get the full payment in free look period; you can cancel your new policy in 15 days by returning the policy to the life Insurance company after you receive all the documents related to the policy.
What is Elimination period in insurance?
In the disability income insurance or loss of income insurance, the elimination period is the amount of time you have to wait before benefits are paid. In other words,it is a time-periodbetween the beginning of theinjury and the benefits you are paid off. Longer the Elimination period lower the premium and vice versa.
Does it cover silver or golden ornaments if I have ‘Home insurance’?
You can cover your valuable items like silver or golden ornaments in home insurance, but your premium and policy amount will rise accordingly.
What is no-claim bonus?
No claim bonus is a benefit for those who have not claimed insurance during the preceding year of cover. This will lower the premium on the following year.
What is the difference between the participating and non-participating policy?
Participating policy is a policy, where the profit or benefits of the insurance company is shared with the insured in theform of a dividend or reversionary bonuses. While, the non-participating policy, does not share their profit with insured.
What is an ‘Endowment Policy’?
An endowment policy is a combination of saving along with risk cover. This type of policy is specially designed to accumulate wealth and at the same time cover your life. In this type of policy the insured will pay a regular premium for specific time period. And in case of death the money will be paid to beneficiary but, if you outlive the policy tenure, you will receive the sum assured along with accumulated bonus.
What is the difference between the ‘All perils’ and ‘Specified perils’ coverage in home insurance coverage?
In home insurance coverage, ‘All perils’ protects you from thewidest range of risks besides common risks while ‘Specified perils’ will give coverage only for the common risks, that is listed in your policy.
What is ‘declaration page’ in insurance policy?
‘Declaration page’ in insurance policy, bears all the information of the policy holder like name, address, vehicle information, type of coverage and loss payee information.
Is it possible to restrict the premium payment for a lesser number of years than the duration of thepolicy?
Certain Insurance company have a provision of Limited Premium Payment, through which you can pay the premium in 3, 5, 7 or 10 years depend upon your income,and you still can have the coverage for the entire tenure of the policy.
What does it mean when company says “no physical exam”?
Such insurance company that says,“No physical exam” gives freedom to the policyholder to take policy and exempt the physical test that is mandatory by certain life insurance company. Normally, such insurance company is more expensive and the insured has to pay a higher premium on their policy.
What is ‘schedule of loss’ in home insurance?
Schedule of loss is a document submitted to theinsurance company to claim the policy; it gives the information of damaged or lost items like model number, when it was purchased, cost of the item etc.
What do you mean by ‘Loss Payee’?
The loss payee is a person or institution (Bank) that receives the insurance payment on the loss of the property or vehicle you own. It is a legal definition used to cover the investment of other parties or bank that is owned by you. For example, you have a car on loan, and also you have insurance for that car. Now you met an accident, and your car is a total loss(meaning completely damaged beyond repair). Your bank still owes money from you in such case when you claim the insurance; the insurance company will pay money directly to Bank or person you owes money. Here bank is a loss payee.
Can beneficiary claim the policy if the insured person is missing or disappeared for several years?
It is possible to claim, if the beneficiary has court declaration that says that the insured person is missing or legally dead (disappeared for more than 7 years).