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?

The company will get 10 lakhs as compensation.

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The company will get 3 lakhs as compensation.

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The company will get 2.5 lakhs as compensation.

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The company will get 6 lakhs as compensation.

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Solution

The correct option is B
The company will get 3 lakhs as compensation.

A fire insurance is a contract under which the insurer in return for a consideration (premium) agrees to indemnify the insured for the financial loss which the latter may suffer due to destruction of or damage to property or goods, caused by fire, during a specified period.
In the above situation, the company will get 3 lakhs as compensation.

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