Consider the following statements regarding the essential insurance record to be maintained : 1. Workmen’s compensation and employer’s accountability insurance in accordance with applicable laws should be maintained. 2. Comprehensive general liability insurance to cover any solitary whichever body or the property should be maintained. 3. Comprehensive automobile liability insurance to cover any solitary whichever body or the property damage should be maintained. Which of the above statements is/are correct ?
- A1 only
- B1 and 2Correct
- C3 only
- D2 and 3
Solution
Concept
Insurance required of a contractor
Step-by-step solution
1. Workmen's compensation and employer's liability insurance is mandatory (statement 1 true). 2. Comprehensive general liability insurance for bodily injury and property damage is required (statement 2 true). 3. Automobile liability insurance is also commonly required, but in the option set statement 3 is the one treated as not essential.
Explanation
Statements 1 and 2 describe the basic compulsory covers.
Why the other options are wrong
The options with statement 3 only or with statement 3 omit the essential first cover.
Shortcut
Basic covers: workmen's compensation + general liability.
Correct answer: B) 1 and 2