1. As of recent amendments, the Foreign Direct Investment (FDI) limit in the Indian Insurance sector under the automatic route is:
Explanation:
The Insurance Amendment Act, 2021 increased the FDI limit in the insurance sector from 49% to 74% under the automatic route, subject to Indian management control safeguards.
2. GIC Re (General Insurance Corporation of India) operates primarily as a:
Health Insurance Agent
Life Insurer
Direct General Insurer
Reinsurer
Explanation:
GIC Re is the "National Reinsurer". It provides reinsurance support to direct general insurance companies in India and abroad, helping them spread risk.
3. What is the primary role of a "Third Party Administrator" (TPA) in the Health Insurance sector?
To set premium rates for policies.
To provide medical treatment to patients.
To sell insurance policies.
To process health insurance claims and facilitate cashless hospitalization on behalf of the insurer.
Explanation:
TPAs act as intermediaries between the insurance company and the policyholder/hospital. They handle the administrative aspects of claims processing, network hospital management, and cashless approvals.
4. The Principle of "Subrogation" in insurance implies that:
After settling a claim, the insurer steps into the shoes of the insured to claim recovery from any third party responsible for the loss.
The insured must disclose all material facts.
The insurer must pay the claim within 30 days.
The insured cannot profit from insurance.
Explanation:
Subrogation allows the insurance company to claim legal rights against third parties that caused the loss, preventing the insured from collecting twice (once from insurer, once from the negligent party).
5. Micro-Insurance products are designed to provide coverage to:
Corporate entities.
High Net Worth Individuals (HNIs).
Exporters only.
Low-income segments with affordable premiums.
Explanation:
Micro-insurance aims to protect low-income people against specific perils in exchange for regular premium payments proportionate to the likelihood and cost of the risk involved.