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2026 Statistics

Key Facts: IC-38 General Exam

Exam Questions

III / IRDAI

60 mins

Exam Time

III / IRDAI

35%

Passing Score

17/50 correct answers

₹590

Exam Fee

₹500 + GST

₹50 lakh

Ombudsman Limit

Nov 2023 amendment

15 hours

Mandatory Training

IRDAI licensing rules

The IC-38 General Insurance Agent exam contains 50 MCQs to be completed in 60 minutes. The passing score is 35% (17 correct answers), and the exam fee is ₹590 (including GST) with training costing an additional ₹886. Aligned with IRDAI rules, it tests insurance principles, underwriting/claims, customer grievances (compensation limit up to ₹50 lakh for Ombudsman), and motor/fire/marine insurance products. No negative marking.

Sample IC-38 General Practice Questions

Try these sample questions to test your IC-38 General exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1What is the primary purpose of general insurance?

A.To eliminate the physical risk of loss

B.To transfer the financial impact of a loss from an individual to an insurer

C.To guarantee a profit for the policyholder in case of an accident

D.To provide retirement income after the age of 60

Explanation: General insurance is designed to transfer the financial impact of unexpected losses to an insurer, protecting the insured's assets. It does not prevent the physical occurrence of losses, is subject to the principle of indemnity (no profit), and is not for retirement.

2Which of the following best describes the concept of mutuality in insurance?

A.Charging the same premium to all individuals regardless of risk

B.A pool where many share the losses of a few unfortunate members

C.Ensuring that the insurer and the insured have a mutual family relation

D.A system where all profits are distributed to the government

Explanation: Mutuality refers to the pooling of risks where premium contributions from many policyholders are collected to pay for the losses of a few. This makes risk-sharing equitable and affordable.

3A risk where there is a possibility of either a loss or a gain is known as:

A.Pure risk

B.Speculative risk

C.Fundamental risk

D.Particular risk

Explanation: Speculative risk involves a chance of loss, gain, or no change (like gambling or business ventures) and is generally uninsurable. Pure risk only has possibilities of loss or no loss (like fire or theft) and is insurable.

4Which risk management technique is represented by purchasing an insurance policy?

A.Risk avoidance

B.Risk retention

C.Risk transfer

D.Risk reduction

Explanation: Buying insurance is a classic form of risk transfer, where the financial consequences of a loss are shifted from the insured to the insurance company in exchange for a premium.

5How does general insurance contribute to the economic development of a country?

A.By offering guaranteed government jobs to all policyholders

B.By releasing capital that would otherwise be held in reserve to meet unexpected losses

C.By eliminating all competitors in the financial market

D.By printing money to cover public debt

Explanation: Insurance mitigates business risks, allowing businesses to operate with less reserve capital. This freed-up capital can be invested in productive economic activities, thus boosting economic growth.

6Deciding not to buy insurance and instead paying for any future losses out of one's own savings is an example of:

A.Risk transfer

B.Risk avoidance

C.Risk retention

D.Risk control

Explanation: Risk retention (or self-insurance) occurs when an individual or business decides to bear the financial burden of any losses themselves rather than transferring it to an insurer.

7What is the difference between a peril and a hazard in general insurance?

A.Peril is the cause of loss, while hazard is a condition that increases the probability or severity of loss

B.Peril is a physical property, while hazard is the financial damage

C.Peril is an insurable event, while hazard is always uninsurable

D.Peril refers to life insurance, while hazard refers to general insurance

Explanation: A peril is the active cause of a loss (e.g., fire, flood, collision). A hazard is a condition or circumstance that makes the occurrence of a peril more likely or more severe (e.g., wet roads, faulty wiring).

8Which of the following is an example of a physical hazard?

A.An insured setting fire to their own shop to claim insurance

B.A driver parking their car in a locked garage

C.Storing highly inflammable chemicals near an open furnace

D.Dishonesty of an employee handling cash

Explanation: A physical hazard is a physical condition that increases the likelihood of a loss. Storing inflammable chemicals near a heat source is a physical hazard. Insured setting fire is a moral hazard.

9Which of the following represents a moral hazard?

A.Faulty electrical wiring in a warehouse

B.Living in a flood-prone low-lying area

C.Intentional neglect of safety rules because the property is fully insured

D.A wooden house built in a dry forest region

Explanation: Moral hazard arises from dishonesty, carelessness, or indifference of the insured to protect their property, often aggravated by the knowledge that they are insured.

10An individual decides not to drive a car or travel by air to eliminate the risk of accidents. Which risk management strategy is this?

A.Risk transfer

B.Risk avoidance

C.Risk reduction

D.Risk retention

Explanation: Risk avoidance involves completely eliminating the exposure to a risk by not engaging in the activity that gives rise to it.

About the IC-38 General Exam

The IC-38 Insurance Agent Exam - General is a mandatory certification exam administered by the Insurance Institute of India (III) on behalf of the Insurance Regulatory and Development Authority of India (IRDAI). It is required for licensing as a general insurance agent in India. The exam covers basic concepts of insurance, principles of insurance, underwriting and documentation, claims procedures, regulatory guidelines for agents, consumer protection laws, and various general insurance products including motor, fire, marine, retail, and commercial policies.

Assessment

50 multiple-choice questions

Time Limit

60 minutes

Passing Score

35% (18/50)

Exam Fee

₹500 + GST (₹590 total) exam fee per III table; online training fee ₹750 + GST (₹886 total) (Insurance Institute of India (III) on behalf of IRDAI)

IC-38 General Exam Content Outline

15%

Introduction & Core Elements of Insurance

Basic concepts of risk, mutuality, risk-sharing pool, historical development, economic significance, and risk management methods (avoidance, reduction, retention, transfer).

15%

Principles & Insurance Contracts

Core legal tenets: Insurable Interest (ownership/liability), Utmost Good Faith (full disclosure of material facts), Indemnity (restoration to pre-loss state), Subrogation, Contribution, and Proximate Cause.

20%

Underwriting, Documentation & Claims

Proposal forms, policy schedule, First Premium Receipt (FPR), risk classification, Section 64VB premium payment rule, loss notification, independent surveyors, and claims documentation.

15%

Customer Service & Grievance Redressal

Customer service quality, grievance handling, Bima Trust (IGMS) portal, pecuniary limits of Consumer Commissions, and the Insurance Ombudsman rules (post-Nov 2023 limit of ₹50 lakh).

15%

Regulatory Aspects of Insurance Agents

IRDAI regulatory authority, agent licensing/appointment, code of conduct, Section 41 (prohibition of commission rebates), and open architecture representation.

20%

General Insurance Products

Motor insurance (mandatory Third Party vs optional Own Damage, IDV, NCB), Standard Fire & Special Perils, Marine Cargo/Hull, Health, Travel, Home, and commercial liability covers.

How to Pass the IC-38 General Exam

What You Need to Know

Passing score: 35% (18/50)
Assessment: 50 multiple-choice questions
Time limit: 60 minutes
Exam fee: ₹500 + GST (₹590 total) exam fee per III table; online training fee ₹750 + GST (₹886 total)

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

IC-38 General Study Tips from Top Performers

1Understand the six legal principles of insurance thoroughly, as they form the foundation of several questions.

2Remember that under Section 64VB of the Insurance Act, premium must be paid in advance before the insurer can assume any risk.

3Memorize the Insurance Ombudsman rules, specifically that complaints must be filed within 1 year of insurer rejection, the service is free, and the compensation limit is ₹50 lakh.

4Study the Consumer Protection Act 2019 limits: District Commission (up to ₹50 lakh), State Commission (₹50 lakh to ₹2 crore), and National Commission (above ₹2 crore).

5Understand how Insured Declared Value (IDV) and No Claim Bonus (NCB) are calculated and applied in Motor Insurance.

6Be clear on the difference between physical hazards (e.g. wet floor, storage of inflammable chemicals) and moral hazards (e.g. dishonesty, intentional neglect).

7Learn the difference between Marine Cargo (covers goods in transit, interest required at loss) and Marine Hull (covers vessel structure, interest required at inception and loss).

8Understand the Average Clause in fire insurance, which reduces claims proportionally if the property was under-insured.

Frequently Asked Questions

What is the IC-38 General Insurance Agent exam?

The IC-38 General Insurance Agent exam is a mandatory test administered by the Insurance Institute of India (III) on behalf of the Insurance Regulatory and Development Authority of India (IRDAI). It is required to obtain a license to sell non-life (general) insurance products in India, such as motor, fire, marine, health, and travel insurance.

What is the passing score and format of the IC-38 exam?

The exam consists of 50 multiple-choice questions (MCQs) to be completed in 60 minutes. The passing score is 35% (17 out of 50 correct answers). There is no negative marking, and the test is conducted online as a computer-based test (CBT).

What are the eligibility requirements to take the exam?

Candidates must have passed at least the 10th standard or equivalent from a recognized board and completed a mandatory 15 hours of structured online or offline training from an IRDAI-authorized training institute.

What is the Insurance Ombudsman's compensation limit in India?

Following the latest regulatory amendments (effective November 2023), the Insurance Ombudsman has the authority to award compensation up to ₹50 lakh (including ex-gratia) to resolve policyholder complaints.

How much does the IC-38 General exam cost?

The examination fee is ₹500 + GST (total ₹590) per attempt, which is set by the Insurance Institute of India (III). The mandatory online training registration costs an additional ₹750 + GST (total ₹886).

How long is the agent license valid once the exam is passed?

Once the candidate passes the exam and is appointed by an insurer, the appointment/license is valid for 3 years. It can be renewed prior to expiry by fulfilling the specified continuing professional training hours.