Elements of Insurance

Q.

Describe various types of insurance and examine the nature of risks protected by each type of insurance.

Q.

A company took fire insurance policy for 10 lakhs. After four months, due to fire, insured suffered a loss of 3 lakhs. How much money will the company get as compensation?

1. The company will get 10 lakhs as compensation.

2. The company will get 3 lakhs as compensation.

3. The company will get 2.5 lakhs as compensation.

4. The company will get 6 lakhs as compensation.

Q. A fire insurance policy usually does not exceed .

1. a year
2. two years
3. three years
4. five years

Q.

The contract of fire insurance is a contract of _________________.

1. certain indemnity

2. none of the above

3. full indemnity

4. strict indemnity

Q.

State True or False. The life insurance premium is paid in one lump sum.

1. True

2. False

Q.

A factory owner gets his stock of goods insured but he hide the fact that the electricity board has issued him statutory warning letter to get his factory. Wiring changed later on, the factory catches fire due to short-circuit which principle is violated in the case.

Q.

What is the difference between fire insurance and marine insurance?

Q.

Sigma Ltd. took insurance cover of Rs. 3, 00, 000 from company A and Rs. 7, 00, 000 from company B, against the goods lying in the godown. Later goods were damaged due to fire and the loss was estimated at Rs. 1, 50, 000.

(a) How much amount will be paid by Company A and B respectively to compensate Sigma Ltd?

(b) State and explain the underlying principle.

Q.

It is the prime responsibility of the insured party to take reasonable steps to minimise loss/damage to the insured property. Name the principle of insurance in this scenario.

Q. Write short notes on the following :
Marine Insurance.

Q.

Is loss measurable in a life insurance policy? Agree or disagree.

1. Agree

2. Disagree

Q.

Pooja owns a bakery store in Pune. She has taken a fire insurance policy for 5 lakhs. After three months, due to fire, she suffered a loss of 2 lakh. How much money will she get as compensation?

1. None of the above

2. 3 lakh

3. 2 lakh

4. 5 lakh

Q. Fire insurance is a contract of indemnity.

1. True
2. False

Q.

What is the duration of the fire policy?

1. Exceeds two years

2. Does not exceed one year

3. Exceeds one year

4. Does not exceed two year

Q. What do you mean by double insurance?

Q.

Cargo does not cover any risk to the cargo.

1. False

2. True

Q. Answer the following question:
Define Fire Insurance. Explain the various types of fire insurance policy.

Q. Write short answers for the following :
What are the types of Fire Insurance policy ?

Q. What is reinsurance?

Q. In the case of marine insurance reserve for unexpired risk is _______.

1. 50%
2. 40%
3. 100%
4. None of these

Q. Match the following

1. Whole Life Policy
2. Duration < 1 year
3. Hull Insurance
4. Crop Insurance