Question

8. Janaklal insured his property with two
insurers AIG Ltd. For rs. 200,000 and
Shreekrishnan General Insurance for rs
600,000. His loss of property actually was
for rs 400,000. What amount he can claim
from both the insurers?
(1 Point)
(a) AIG Ltd - 200,000
Shreekrishnan General Insurance-
200,000
(b) AIG Ltd- 100,000
Shreekrishnan General Insurance-
300,000
(c) AIG Ltd - 300,000
Shreekrishnan General Insurance-
100,000
(d) AIG Ltd-280,000
Shreekrishnan General Insurance-
120,000​

Answer 1

b

Explanation:

1:3 ratio

1 is a ratio of AIG

3 is a ratio of general.

Answer 2

Answer:

The correct option is (b)AIG Ltd- 100,000 Shreekrishnan General Insurance-300,000

Explanation:

Risk distribution among a group of people is how insurance works. As a result, cooperation becomes the fundamental tenet of insurance.

The following seven insurance principles must be upheld by both the insurer and the insured in order for an insurance contract to function properly:

1. Utmost Good Faith
2. Proximate Cause
3. Insurable Interest
4. Indemnity
5. Subrogation
6. Contribution
7. Loss Minimization

Principle of Contribution-

When an insured person purchases multiple insurance policies covering the same risk, the contribution principle is in effect. The insured cannot make money by claiming the loss of one subject matter from other policies or businesses, which is what the concept of indemnification states.

Example-

A property worth Rs. 5 Lakhs is insured for Rs. 3 Lakhs with Company A and for Rs. 1 Lakh with Company B. If the property is damaged for three lakhs, the owner can sue Company A for the full amount, but he is then barred from suing Company B for any compensation. Company A can now request from Company B the proportionate amount of value reimbursed.

Since, Janaklal has insured his property for 200000 with AIG ltd. and for 600000 with Shreekrishnan General Insurance. The ratio is 1:3. Therefore, he can claim the damages entirely from Shreekrishnan or from both the Insurers in the ratio of 1:3.

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