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1. Kazi moto insured a motor vehicle against fire with MotoMoto company by paying  

   Kshs.300.000. later the car was destroyed at a garage and a compensation of Kshs. 400,000 

    were paid. Using insurance terms, state what each of the following stand for ;  

   a) Kazi Moto

   b) Fire 

   c) Kshs 300,000

   d) Moto Moto Company

2. Give the significance of the following principles to both the insurer and insured  

    i) Utmost good faith 

    ii) Indemnity…..

    iii) Contribution

    iv) Insurable interest..

3. The following are description of various insurance policies. Identify the name of the policy 

       described by the statement:    

Description Policy 

1 Covers an organization against losses which might arise as a result of debtors failure to pay their debts

2 Covers for the loss of profit due to interruption of business activities as a result of fire

3 Covers employees who may suffer injuries while on official duties

4 Covers partial or total physical disability caused to a person due to injury

5. Define the following types of marine insurance losses:-

   (a) Total constructive loss

   (b) General average loss

6. State four conditions necessary for the operation of the principle of indemnity in insurance

7. Highlight four characteristics of an insurable scheme

8. Outline four benefits of the “Pooling of risks” to an insurance company

9. Describe the procedure of acquiring an insurance policy

10. A private warehouse owner insured his warehouse valued at Kshs.400, 000 for Kshs600, 000 against risk of fire. The warehouse was later destroyed completely by fire including goods worth shs 100,000.

    Required:

    i) Determine the amount of compensation paid by the insurance company           

    ii) Give a reason for your answer in (i) above              

14.- INSURANCE

1. Under what circumstances can an insurance company fail to compensate the insured in the 

      event of occurrence of the insured risk?

2. Describe the procedure for taking up an insurance policy

3. Your father wants to insure his life with British American Insurance Company. As a Business 

     Studies student, explain to him five benefits of life assurance

4. Explain five principles of insurance

SCIENCE
HEALTH SCIENCE
NURSING

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