IC57 FIRE AND CONSEQUENTIAL LOSS INSURANCE - 09
| Q1.The tax authorities permanently confiscated some stocks of Mr. A due to fiscal violations. Judge this example and choose the correct option from below. |
| The loss due to confiscation is not at all covered under the policy |
| The loss due to confiscation is fully covered under the policy |
| The loss due to confiscation should be partially covered under the policy |
| A pro-rata inclusion can be made under the policy |
| The loss can be covered if the tax authorities permit the same |
| Q2.Mr. X wanted to give a monthly declaration for the purpose of declaration policies. What should be the valid base for it? |
| The average value on any day of the month |
| Average of the highest value at risk on each day of the month |
| The highest value on any day of the month |
| All the above |
| Options b and c |
| Q3.Which of the below statements is true regarding old machines which perform well and old machines where the rate of technological improvement is high? |
| Cost of replacement calculation is not possible for the former one |
| Cost of replacement calculation is a complicated task for the former one |
| The cost of replacement is always zero for the former one |
| Cost of replacement calculation is a complicated task for the latter one |
| Cost of replacement calculation is not possible for the latter one |
| Q4.Note down one of the special features under Section IV. |
| One industry-One rate |
| The dual rate for a single policy |
| Per Se rate for all industries |
| Single rate for a single policy |
| The dual rate for all industries |
| Q5.Which plan of action is helpful in making the task of valuing the stock-in-process easy? |
| Improvement in taxation accounting |
| Improvement in the financial accounting system |
| Improvement in liaisoning with the government agencies like ROC, SEBI, etc. |
| Implementation of the techniques of financial management |
| Implementation of an efficient cost accountancy method |
| Q6.Under insurance and loss experience, information will relate to whether the insurance was _____________. |
| Suggested by some professional advisor |
| Offered first by any other insurer |
| Declined or canceled or not renewed by other insurers |
| Suggested by some government authority |
| Q7.Mr. B’s factory building is about 50 meters away from the next building. State the correct assumption in this case. |
| This is not a case of an exposure hazard |
| This is clearly a case of an exposure hazard |
| There is an exposure hazard as the distance between two buildings has no relevance for spreading the fire |
| It cannot be assumed that there is no exposure hazard without consideration of the conditions existing between the buildings. |
| It cannot be assumed that there is no exposure hazard without consideration of the conditions existing inside the buildings |
| Q8.Choose from below, the statement which is contrarily related to the depreciation for insurance purposes? |
| Depreciation means agreed value to be deducted every year from the cost of the asset |
| Depreciation means, depreciation as per the Companies Act |
| Depreciation means, actual intrinsic physical depreciation |
| Depreciation means, depreciation rates used for accounting purposes |
| Depreciation means, depreciation as per the Insurance Act |
| Q9.Identify the variation between the Supervision clause and the Moral Hazard clause. |
| Moral Hazard clause requires assessment of housekeeping function |
| Supervision clause is easier for assessment |
| Supervision clause requires assessment of risk coverage |
| The moral Hazard clause is mandatory whereas the former is optional |
| The Moral Hazard clause is easier for assessment |
| Q10.ABC Ltd. (a reinsurer), says that there cannot be proportionate sharing of risks in the Excess of loss treaty. State whether ABC ltd. is correct. |
| Yes. ABC Ltd. is correct |
| Yes, ABC Ltd is correct, but it depends mainly on the agreement |
| No, ABC Ltd is incorrect. What it says is about the surplus treaty |
| No, ABC Ltd is incorrect. What it says is about quota share |
| No, ABC Ltd is incorrect. What it says is about proportional treaties |