IC S01 - Exam Principles And Practice Of Insurance And Survey And Loss Assessment-39

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Q 1. When might insurers take over salvage disposal?

a) When the insured offers a fair value for the salvage.

b) When the salvage cannot be reconditioned or reused by the insured.

c) When salvage auctions result in high realizations.

d) When salvage recovery agents refuse to provide quotations.

e) When salvage disposal expenses are minimal.
 
Q 2. Why is presenting the proximate cause of loss unambiguously important for the surveyor?

a) To delay the claims settlement process

b) To confuse the insurer

c) To increase the complexity of the claim

d) To support the insurer's decision on claim admissibility

e) To minimize the insurer's liability
 
Q 3. How is the sum insured determined in a profits policy?

a) It is fixed by the insurer

b) It is based on the insured's preferences

c) It represents the gross profits of the selected indemnity period

d) It is calculated based on the insured's variable expenses

e) It is determined by government regulations
 
Q 4. What is the sum insured based on in a profits policy?

a) Previous year's losses

b) Projected future losses

c) Net profit only

d) Gross profit and insured standing charges

e) Variable expenses
 
Q 5. What is the compensation payable for permanent partial disablement according to the policy?

a) A fixed amount of Rs. 1,00,000

b) A percentage of the capital sum insured as shown in the table in the policy

c) Rs. 50,000

d) Rs. 25,000

e) Rs. 75,000
 
Q 6. What do Institute Time Clauses – Hulls (ITC – Hulls) form the basis for?

a) Cargo insurance policies

b) Marine liability insurance policies

c) Hull insurance policies for vessels and their machinery

d) Aviation insurance policies

e) Property insurance policies
 
Q 7. In what circumstance might insurers decline a risk?

a) If the proposer has a good credit history

b) If the proposer offers to pay a higher premium

c) If the physical hazard involved is considerably bad

d) If the proposer provides additional security measures

e) If the proposer has multiple insurance policies
 
Q 8. What is the purpose of policy conditions in insurance contracts?

a) To limit the liability of the insured

b) To complicate the claims process

c) To emphasize the principle of utmost good faith

d) To provide additional coverage options

e) To exempt the insurer from responsibility
 
Q 9. In cases of total losses under subrogation, what additional entitlement does the insurer have?

a) The right to recover from third parties

b) The right to take over the remaining property

c) The right to demand a higher premium

d) The right to sue the insured

e) The right to void the insurance contract
 
Q 10. When is the insured value paid in hull policies in the case of total loss?

a) When the ship is damaged

b) When the ship is deemed obsolete

c) When the ship is partially lost

d) When the ship is involved in a maritime accident

e) When the ship is completely lost
 
Q 11. What is the purpose of the Material Alteration Condition in insurance policies?

a) To specify the period of coverage under the policy.

b) To outline the process for filing a claim with the insurer.

c) To determine the premium amount to be paid by the insured.

d) To specify circumstances under which the insurance coverage ceases to apply.

e) To define the scope of the insured perils covered by the policy.
 
Q 12. Under the Consequential Loss (Fire) Policy, which of the following consequential losses are not payable?

a) Loss of rent.

b) Failure to recover book debts owing to destruction of records.

c) Riot, strike, and malicious damage.

d) Loss of goodwill.

e) Cost of substitute equipment.
 
Q 13. Why should an LPG bottling station be located downwind of the plant in a petrochemical complex?

a) To optimize the distribution of finished products

b) To minimize the risk of fire spreading to the plant

c) To reduce the risk of air pollution from emissions

d) To improve employee morale and safety perception

e) To facilitate the transportation of raw materials
 
Q 14. Which body can appeals against the decisions of the regulator be filed with as per the amendments?

a) Insurance Regulatory and Development Authority

b) Central Government

c) Supreme Court

d) Securities Appellate Tribunal

e) High Court
 
Q 15. What benefits are provided under the Employees’ State Insurance Act, of 1948?

a) Benefits for unemployment only

b) Benefits for maternity only

c) Benefits for sickness, maternity, and employment injury

d) Benefits for retirement only

e) Benefits for educational expenses


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