IC56 Mock Test Sample 10
Fire insurance involves key legal and operational principles such as material facts, utmost good faith, and indemnity. A material fact influences an underwriter’s decision on risk acceptance and premium. Claims must be filed within a specified time, and proper documentation is essential. Reinstatement policies require timely repair or replacement, usually within a defined period. Concepts like betterment, fraud, and consensus ad idem are important in claim assessment and contract validity. Various policy types like floating policies cover multiple locations. Deductibles and provisos define claim limits and conditions. Understanding these principles helps ensure fair claim settlement and compliance with policy terms.
Q1. A __________ has been defined as a fact which affects the judgement of a prudent underwriter
a) Substantiated fact
b) Legal fact
c) Suppressed fact
d) Material fact
Q2. Complaint must be filed within ______ from cause of action
a) Six months
b) One year
c) Two years
d) Three years
Q3. Common intention between parties is known as
a) Ab initio
b) Consensus ad idem
c) Caveat emptor
d) Uberrima fides
Q4. Written notice must include
a) Details of damaged property
b) Amount of loss
c) Other insurances
d) All of the above
Q5. Reinstatement must be completed within ______
a) 12 months
b) 18 months
c) 24 months
d) 30 months
Q6. Which view states cost of production does not reflect true value?
a) Traditional view
b) Modern view
c) Market view
d) Replacement view
Q7. Fraud in claims may arise due to
a) Good faith
b) Fraud
c) Honesty
d) Mistake
Q8. Superior qualities in replaced machinery are called
a) Enhancement
b) Augmentation
c) Betterment
d) Advancement
Q9. Claim amount under National Commission
a) Rs. 5 lakhs
b) Rs. 10 lakhs
c) Between Rs. 5–20 lakhs
d) ₹2 crore
Q10. Fact affecting underwriter decision is called
a) Warranties
b) Material fact
c) Underwriting
d) Consideration
Q11. Add-on covers include
a) Spontaneous combustion
b) Earthquake
c) Leakage and contamination
d) All of the above
Q12. Perils covered are mentioned under
a) Operative clauses
b) Privileges
c) Conditions
d) Attestation
Q13. Breach affecting policy after inception is
a) Condition precedent to contract
b) Condition precedent of liability
c) Condition subsequent
d) None of these
Q14. Same production capacity requirement means
a) Not superior or extensive
b) Same kind or type
c) Positive and negative factors
d) None of these
Q15. Policy covering stocks at multiple locations
a) Declaration policy
b) Floating policy
c) Floating declaration policy
d) Cancellation policy
Q16. Rakesh claim (underinsurance case)
a) Rs. 20,000
b) Rs. 30,000
c) Rs. 40,000
d) Rs. 50,000
Q17. Deductible of ______ applies per claim
a) 1%
b) 3%
c) 5%
d) 10%
Q18. Furniture, Fixtures & Fittings include
a) Counters and showcases
b) Tables and chairs
c) Office machines
d) All of the above
Q19. Proviso for normal indemnity until expenditure incurred
a) Proviso 1
b) Proviso 2
c) Proviso 3
d) Proviso 4
Q20. Modern view statement is
a) True
b) False
