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Insurance Basics Quiz: 10 Questions with Answers (India)

Written by the Quizzeela team · Reviewed by Utsav Raj
Last checked · 10 questions · Easy

Every insurance policy uses the same basic words. Learn them in 10 questions so you can read any policy with confidence.

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1What is a "premium" in insurance?

  1. A type of claim
  2. The amount you pay to keep the policy active
  3. The money the insurer pays you
  4. A tax
Show answer
Answer: B. The amount you pay to keep the policy active. The premium is what you pay, monthly or yearly, to keep your insurance cover active.

2Which body regulates insurance companies in India?

  1. IRDAI
  2. RBI
  3. NPCI
  4. SEBI
Show answer
Answer: A. IRDAI. The Insurance Regulatory and Development Authority of India (IRDAI) regulates insurers.

3Where is IRDAI's headquarters?

  1. Mumbai
  2. New Delhi
  3. Bengaluru
  4. Hyderabad
Show answer
Answer: D. Hyderabad. IRDAI is headquartered in Hyderabad.

4What is the "free-look period"?

  1. A discount week
  2. Time when claims are not paid
  3. Time to return a new policy if you do not like it, for a refund
  4. A free holiday
Show answer
Answer: C. Time to return a new policy if you do not like it, for a refund. During the free-look period you can cancel a new policy and get a refund, minus small charges. For life insurance it is 30 days from receiving the policy.

5What is a "grace period"?

  1. The policy term
  2. Extra time to pay a missed premium without the policy lapsing
  3. Time to file a claim
  4. The waiting period for illness
Show answer
Answer: B. Extra time to pay a missed premium without the policy lapsing. After the due date, the grace period gives you extra days to pay the premium. Cover usually continues during it.

6The person who receives the claim amount if the life insured dies is the:

  1. Underwriter
  2. Nominee
  3. Surveyor
  4. Agent
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Answer: B. Nominee. The nominee receives the money. Keep nominee details updated in every policy.

7What is a "rider" in an insurance policy?

  1. A type of vehicle
  2. An extra benefit added for an extra premium
  3. A late fee
  4. The insurance agent
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Answer: B. An extra benefit added for an extra premium. Riders add cover, such as accidental death or critical illness, for a small extra premium.

8Claim settlement ratio shows:

  1. The premium rate
  2. The policy term
  3. The agent's commission
  4. How many claims an insurer paid out of those it received
Show answer
Answer: D. How many claims an insurer paid out of those it received. It is the share of claims settled out of claims received in a year. A higher ratio is generally better.

9If your insurer does not solve your complaint, you can approach the:

  1. Election Commission
  2. Income Tax Department
  3. Traffic police
  4. Insurance Ombudsman
Show answer
Answer: D. Insurance Ombudsman. The Insurance Ombudsman resolves complaints against insurers free of cost.

10Hiding a known illness when buying health or life insurance can lead to:

  1. A bigger bonus
  2. Rejection of the claim later
  3. Nothing
  4. Lower premium forever
Show answer
Answer: B. Rejection of the claim later. Insurers can reject claims if important facts were hidden. Always disclose your health honestly.
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Sources: IRDAI (irdai.gov.in) and its policyholder handbooks. For learning only, not financial, tax or insurance advice. Found a mistake? Use "Report a mistake" in the timed quiz.