Important Points for IC 57 - Fire and Consequential Loss Insurance Exam
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The trading losses which result from stoppage of business may be considered under three headings: i. Net profit; ii. Standing charges; iii. Increased cost of working
Loss of profits is determined and measured with reference to reduction in turnover and this is the basis adopted in profits insurance.
Turnover consists of following three elements: i. Variable charges; ii. Standing charges; iii. Net profit
The measure of indemnity is the sum produced by applying the rate of gross profit to the reduction in turnover during an agreed period following damage.
The indemnity period chosen by the insured may vary from 3 months to 3 years.
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