Savings bank account
Bank interest + 2%
5.00%
10%
Answer is Wrong!
Answer is Right!
The correct answer is C. 5.00%.
The Insurance Act, 1938, Section 125 states that if there is any delay in settlement of claim within 30 days, other than an early claim, the insurer has to pay interest at the rate of 5% per annum.
Option A is incorrect because savings bank account interest rates are typically lower than 5%.
Option B is incorrect because bank interest rates are typically higher than 5%.
Option D is incorrect because the Insurance Act, 1938, does not specify a rate of interest of 10%.