IC S01 - Exam Principles And Practice Of Insurance And Survey And Loss Assessment-20

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Q 1. When is salvage loss settlement used?

a) When damaged goods are sold at an intermediate port to prevent further damage.

b) When goods are destroyed during transportation.

c) When goods are stolen during transit.

d) When damaged goods are abandoned by the insured.

e) When damaged goods are sold at the final destination port.

Q 2. What is the maximum recommended pile size for indoor storage in the paper industry?

a) 250 to 500 tons per pile

b) 500 to 750 tons per pile

c) 750 to 1000 tons per pile

d) 1000 to 1250 tons per pile

e) 1250 to 1500 tons per pile

Q 3. What action must be communicated to the policyholder along with the policy document according to the Grievance Redressal Procedure?

a) The insurer's favorite color

b) The contact details of the Insurance Ombudsman

c) The insured's favorite food

d) The insured's favorite movie

e) The insurer's favorite book

Q 4. Under which circumstances does a carrier, wharfinger, or warehouse keeper commit a "criminal breach of trust" as per Section 407 of the Indian Penal Code?

a) Accidentally damaging goods while in transit

b) Deliberately misplacing goods entrusted to them

c) Charging excessive fees for storage services

d) Failing to deliver goods due to unforeseen circumstances

e) Dishonestly misappropriating entrusted property

Q 5. What often leads to problems for surveyors regarding contractual and commercial issues?

a) Lack of computerization

b) Inadequate training

c) Inadvertent mistakes by insurers during underwriting

d) Overreliance on software systems

e) Deliberate misrepresentation by claimants

Q 6. What was established in the U.S. by self-employed adjusters in 1937?

a) The Independent Insurance Adjusters Association

b) The National Association of Independent Insurance Adjusters of America

c) The Commercial Adjustment Bureau

d) The General Adjustment Bureau

e) The Quarterly Adjusters Magazine

Q 7. In what circumstances might an insurer settle a claim for a lower amount as an "ex-gratia" payment?

a) When the insured insists on a higher payout

b) When the surveyor fails to identify discrepancies

c) When the discrepancies are minor and insignificant

d) When the insurer wants to avoid further investigation

e) When the nature of anomalies observed warrants a reduced settlement

Q 8. What is the average useful economic life for conventional machine tools and similar equipment?

a) 5 to 10 years

b) 10 to 15 years

c) 15 to 20 years

d) 20 to 25 years

e) 25 to 30 years

Q 9. What does the insurer expect from a survey report regarding the recommended loss amount?

a) Ambiguity to allow for negotiation

b) Aesthetic presentation for visual appeal

c) Unambiguous terms to withstand auditor scrutiny

d) Excessive detail to overwhelm auditors

e) Flexibility to accommodate multiple interpretations

Q 10. What type of income is typically taken to the credit side of the Profit and Loss account?

a) Capital contributions

b) Dividend received

c) Office expenses

d) Staff salaries

e) Rent

Q 11. Which of the following is excluded under the Standard Fire and Special Perils policy?

a) Damage caused by lightning

b) Loss due to war and civil war

c) Damage from fire and explosion

d) Loss from burglary and theft

e) Damage from burst water tanks

Q 12. Under what circumstances does cash cover operate in burglary insurance?

a) When cash is left unattended on the premises

b) When cash is stored in a safe and secured with any lock

c) When cash is stored in a secure location within the premises

d) When cash is deposited in a bank account

e) When cash is kept in open areas within the premises

Q 13. When does the cover for war risks apply under Institute Cargo Clauses (AIR)?

a) Throughout the entire transit

b) Only during loading and unloading

c) While the cargo is waterborne

d) Only during storage

e) Only during air transport

Q 14. What does the declaration include in insurance proposal forms required of the proposer?

a) To disclose only material facts

b) To warrant the truth and accuracy of statements

c) To provide incomplete information

d) To rely on the insurer's assessment

e) To include exaggerated details

Q 15. What term is used to describe the amount paid by individuals who are exposed to a risk to a common fund in the insurance business?

a) Pure profit

b) Pure Premium

c) Administrative expense

d) Risk contribution

e) Loss payment


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