Insurance Claims

INSURANCE CLAIMS AFTERSCHO☺OL – DEVELOPING CHANGE MAKERS CENTRE FOR SOCIAL ENTREPRENEURSHIP PGPSE PROGRAMME – World’ Most Comprehensive programme in social entrepreneurship & spiritual entrepreneurship OPEN FOR ALL FREE FOR ALL

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INSURANCE CLAIMS Dr. T.K. Jain.

AFTERSCHO☺OL Centre for social entrepreneurship Bikaner M: 9414430763 [email protected] www.afterschool.tk, www.afterschoool.tk www.afterschoool.tk 11/28/09 www.afterschoool.tk

AFTERSCHO☺OL's AFTERSCHO☺OL's MATERIAL MATERIAL FOR PGPSE PARTICIPANTS

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What is average clause? • When there is any loss the insurable claim amount is calculated as per the following formulae: • Claim = loss suffered * (sum insured / actual insurance value) • For example, if Ramu’s property is of 5 lakh, but gets insurance for Rs. 4 lakh only and suffers loss of 2.5 lakh, then he will get only Rs. 2 Lakh, not Rs. 2.5 lakh (proportionate). 11/28/09 www.afterschoool.tk

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Principles of loss calculation… • When proper records and maintained and they are not lost then we will deduct the value of goods salvaged / saved from the value of stock in godown. • If the record is lost, then we prepare an estimated trading account.

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How to prepare estimated trading account? • Take the ratio of GP (gross profit), get the data regarding sales of the period, use GP ratio to estimate the gross profit and then try to estimate other expenses. If purchase, opening stock and sales data are available, the closing stock data can be easily estimated and thus loss can be ascertained. 11/28/09 www.afterschoool.tk

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Guidelines for preparation of estimated trading account… • If the Gross profit ratio of last year is not based on stock valuation on cost, then adjust the stock first to represent it on cost and they find out new GP rate. Similarly, if the the records of the previous years show closing stock not on cost – then adjust them first to value them on cost. • You may take average of last few years’ GP to take average GP ratio. If there is some trend, use weighted or geometric mean to find the average GP ratio. 11/28/09 www.afterschoool.tk

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If the records are lost on fire? • Contact customers, suppliers to ascertain the value of purchase and sale • Contact the auditors to get information about our records.. • Obtain last year’s records and try to estimate this year’s figures. • Deduct salvaged stock from the stock on the date and use average clause for estimating the loss by fire. 11/28/09 www.afterschoool.tk

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Suppose Ramu had a closing stock of 12 lakh last year. His GP was 20%. This year he purchased goods of Rs. 2 lakhs and sold goods of Rs. 5 Lakhs. What is his insurance claim if fire destroyed 80% of the goods and records. His other expenses upto this time was Rs. 5 lakhs last year? Insurance amount = 10 Lakhs

• Goods = (12+2+ 1+5 – 5) = 15 Lakhs. • 80% of 15 lakhs = 12 Lakhs as insurance claim. 12 * (10/15) = 8 Lakhs answer. 11/28/09 www.afterschoool.tk

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Loss of profit… • Identify the period of indemnity – by taking up the period of dislocation or period of indemnity • Identify GP Ratio and identify the loss of turnover • Identify the increased cost of working • Ascertain the amount of net claim by applying the average clause. 11/28/09 www.afterschoool.tk

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About AFTERSCHO☺OL • PGPSE - World’s most comprehensive programme on social entrepreneurship – after class 12th • Flexible – fast changing to meet the requirements • Admission open throughout the year • Complete support from beginning to the end – from idea generation to making the project viable. 11/28/09 www.afterschoool.tk

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Branches of AFTERSCHO☺OL • PGPSE programme is open all over the world as free online programme. • Those who complete PSPSE have the freedom to start branches of AFTERSCHO☺OL • A few branches have already started one such branch is at KOTA (Rajasthan).

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Workshop on social entrepreneurship • We conduct workshop on social entrepreneurship – all over India and out of India also - in school, college, club, association or any such place - just send us a call and we will come to conduct the workshop on social entrepreeurship. • These workshops are great moments of learning, sharing, and commitments. 11/28/09 www.afterschoool.tk

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FREE ONLINE PROGRAMME • AFTERSCHO☺OL is absolutely free programme available online – any person can join it. The programme has four components : • 1. case studies – writing and analysing – using latest tools of management • 2. articles / reports writing & presentation of them in conferences / seminars • 3. Study material / books / ebooks / audio / audio visual material to support the study • 4. business plan preparation and presentations of those plans in conferences / seminars 11/28/09 www.afterschoool.tk

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100% placement / entrepreneurship • AFTERSCHO☺OL has the record of 100% placement / entrepreneurship till date • Be assured of a bright career – if you join AFTERSCHO☺OL

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Pursue professional courses along with PGPSE • AFTERSCHO☺OL permits you to pursue distance education based professional / vocational courses and gives you support for that also. Many students are doing CA / CS/ ICWA / CMA / FRM / CFP / CFA and other courses along with PGPSE. • Come and join AFTERSCHO☺OL

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