Question

0.13 On 31/12/2000 A fire damaged the premises of R Lrd. And the business of company was disorganized until 31/12/2001. The co. was insured under a loss of profit policy for Rs. 13,000 with the 6 month of indemnity. Co. closed on their account on 31" October. Figures of 31/10/2000 were as follows: 1) Turn over Rs. 35,000, 2) Standing charges RS. 10,000 The turn overfor 12 month ended 31/12/2000 was Rs. 39,000. The turn over during the period of dislocation amount Rs. 4,000 while during the corresponding this location period preceding year was Rs. 8,500. A sum of Rs. 2,000 was spent in additional to minimize the effect of the loss​

Answer 1

Answer:

The actual amount of claim is determined by the formula:

Claim = Loss Suffered x Insured Value/Total Cost. The object of such an Average Clause is to limit the liability of the Insurance Company. Both the insurer and the insured then bear the loss in proportion to the covered and uncovered sum.