CLASS XI: CHAPTER 4 QUESTION BANK
Business Services | 10 Practice Sets (CBSE 2026-27)
📌 General Instructions for All Sets:
- Maximum Marks: 25 | Time Allowed: 45 Minutes
- Questions 1-5 are objective type carrying 1 mark each (MCQs & Assertion-Reasoning).
- Questions 6-7 are short answer type carrying 3 marks each (30-40 words).
- Questions 8-9 are short answer type carrying 4 marks each (50-80 words).
- Question 10 is a long answer type carrying 6 marks (100-150 words).
- Strictly adhere to the CBSE Competency/Case-Based format.
📄 PRACTICE PAPER - SET 1 (Level: Easy - Fundamental Concepts)
SECTION A (1 Mark Each)
1. Which of the following is a characteristic of services?
[Case-Based] Mr. Amit deposits his savings in a bank account where he cannot withdraw the money before 5 years. In return, he gets a high rate of interest.
2. This type of account is called:3. The primary function of a commercial bank is to:
4. Assertion (A): Services cannot be stored for future use.
Reason (R): Services are highly perishable and their production and consumption take place simultaneously.
Reason (R): Services are highly perishable and their production and consumption take place simultaneously.
5. Assertion (A): Current accounts do not earn any interest.
Reason (R): Current accounts are primarily meant for businessmen who require frequent and unlimited withdrawals and deposits every day.
Reason (R): Current accounts are primarily meant for businessmen who require frequent and unlimited withdrawals and deposits every day.
SECTION B (3 Marks Each)
6. Differentiate between 'Goods' and 'Services' on any three bases.
[Case-Based] Mrs. Sharma wants to save ₹2,000 every month out of her salary for the next 3 years to buy a laptop for her son.
7. Which type of bank account is most suitable for her? Explain its main feature.
SECTION C (4 Marks Each)
8. Explain the term 'e-Banking'. State any three benefits of e-Banking to the customers.
[Case-Based] 'Alpha Traders' frequently falls short of funds to pay its suppliers at the end of the month. The bank allows them to withdraw more money than what is available in their Current Account up to a specified limit.
9. Identify the facility provided by the bank. Explain how it works.
SECTION D (6 Marks Each)
[Case-Based] Modern businesses cannot survive without a robust support system. Whenever a factory is set up, it requires heavy machinery and working capital. For this, businesses approach financial institutions. To protect the factory from the risk of fire or natural calamities, another service sector guarantees compensation against premiums. Furthermore, the finished goods need to be kept safe from spoilage until demand arises, requiring massive storage facilities. Lastly, to sell the goods globally, businesses rely heavily on the internet and telephone networks to communicate with buyers instantly.
10. By quoting lines from the paragraph, identify and explain the **four different types of Business Services** (Banking, Insurance, Warehousing, Telecom) utilized by the factory.
📄 PRACTICE PAPER - SET 2 (Level: Moderate - Application & Analysis)
SECTION A (1 Mark Each)
1. Which of the following is an electronic fund transfer system where transactions are settled continuously on a real-time basis?
[Case-Based] A person insures his factory against fire. He intentionally hides the fact that highly explosive chemicals are stored next to the boiler. A fire breaks out.
2. The insurance company rejects the claim based on the violation of which principle?[Case-Based] Mr. X insures his car worth ₹5 Lakhs for ₹7 Lakhs. The car is completely destroyed in an accident. The insurance company pays him only ₹5 Lakhs.
3. This is an application of the principle of:4. Assertion (A): Life insurance is a contract of indemnity.
Reason (R): The principle of indemnity states that the insured should neither make a profit nor suffer a loss, but human life cannot be valued in terms of money.
Reason (R): The principle of indemnity states that the insured should neither make a profit nor suffer a loss, but human life cannot be valued in terms of money.
5. Assertion (A): Under NEFT, fund transfers occur in batches.
Reason (R): Transactions are pooled together and cleared at specific intervals during the day, unlike RTGS which is instant.
Reason (R): Transactions are pooled together and cleared at specific intervals during the day, unlike RTGS which is instant.
SECTION B (3 Marks Each)
6. Differentiate between 'RTGS' and 'NEFT' on any three bases.
[Case-Based] Rahul took a fire insurance policy for his neighbor's house because he liked looking at it. When the house burnt down, Rahul filed a claim for the insurance money.
7. Will the insurance company pay Rahul? Identify and explain the principle of insurance applicable here.
SECTION C (4 Marks Each)
8. Explain the Principle of 'Utmost Good Faith' (Uberrimae Fidei) with a suitable example.
[Case-Based] A thief stole a scooter belonging to Amit. Amit claimed the insurance money, and the company paid him the full value. A month later, the police recovered the stolen scooter. Amit tried to claim the scooter back from the police.
9. Can Amit claim the scooter after receiving the insurance money? Explain the relevant principle of insurance.
SECTION D (6 Marks Each)
[Case-Based] 'Zeta Traders' operates a massive import-export business. They maintain an account with a commercial bank where they deposit and withdraw money 50 times a day, without earning any interest. To pay an international supplier urgently, they instruct the bank to transfer ₹10 Crores instantly on a real-time basis without any batching delays. Furthermore, they keep a secure, password-protected plastic card that allows them to withdraw cash from machines anytime, even when the bank is closed. Lastly, the bank issues them a guarantee letter that assures a foreign seller that Zeta Traders will make the payment, enabling them to import goods safely.
10. By quoting lines from the paragraph, identify and explain the **type of bank account**, the **electronic fund transfer system**, the **e-banking card**, and the **banking service/instrument** utilized by 'Zeta Traders'.
📄 PRACTICE PAPER - SET 3 (Level: Moderate-High - Nuanced Competency)
SECTION A (1 Mark Each)
1. Which principle states that the insured must take all reasonable steps to minimize the loss to the insured property?
[Case-Based] Mr. Sen insures his warehouse worth ₹10 Lakhs with two different companies: Company A for ₹6 Lakhs and Company B for ₹4 Lakhs. A fire causes a loss of ₹5 Lakhs.
2. How will the loss be compensated?3. The term 'Causa Proxima' means:
4. Assertion (A): Life insurance has an element of both protection and investment.
Reason (R): The insured gets a lump sum amount either on the maturity of the policy or upon death, assuring a return on the premium paid.
Reason (R): The insured gets a lump sum amount either on the maturity of the policy or upon death, assuring a return on the premium paid.
5. Assertion (A): Insurable interest must be present at the time of taking the policy as well as at the time of loss in Fire Insurance.
Reason (R): In Fire Insurance, the insured must suffer an actual financial loss when the property is destroyed by fire.
Reason (R): In Fire Insurance, the insured must suffer an actual financial loss when the property is destroyed by fire.
SECTION B (3 Marks Each)
6. Explain the principle of 'Contribution' in insurance with an example.
[Case-Based] A cargo ship was insured against perils of the sea. Rats made a hole in the ship. Seawater entered through the hole and destroyed the cargo.
7. Identify the principle of insurance used to decide the claim. Will the insurance company pay? Explain.
SECTION C (4 Marks Each)
8. Explain the principle of 'Mitigation of Loss'. Why is the insured expected to behave as if he is uninsured during an accident?
[Case-Based] A man took a life insurance policy for his wife. Two years later, they got divorced. A year after the divorce, the ex-wife died. He claimed the life insurance money.
9. Will he receive the insurance money? Explain the rule of 'Insurable Interest' specifically relating to Life Insurance to justify your answer.
SECTION D (6 Marks Each)
[Case-Based] Mr. Kapoor owned a textile mill. He insured the mill against fire for ₹50 Lakhs. One night, a massive fire broke out. Mr. Kapoor stood outside watching the factory burn without calling the fire brigade, thinking he would get the full insurance money anyway. The fire caused a loss of ₹30 Lakhs. Later, investigation revealed that the fire was caused by a short circuit, which then ignited some explosive gas cylinders illegally stored in the mill, causing the massive damage. The insurance policy explicitly excluded losses caused by gas explosions. Ultimately, the insurance company paid nothing.
10. Identify and explain the **two principles of insurance** violated/applied in this case that led the insurance company to completely reject Mr. Kapoor's claim.
📄 PRACTICE PAPER - SET 4 (Level: Hard - Analytical Competency)
SECTION A (1 Mark Each)
1. Which type of insurance policy provides a fixed sum of money either on the death of the insured or on the expiry of a specified period, whichever occurs earlier?
[Case-Based] A company insures its cargo ship against the risk of collision with hidden rocks and sinking during a voyage from Mumbai to London.
2. This is an example of:3. In marine insurance, if the ship arrives safely but the cargo owner refuses to pay the transportation charges, the shipping company can protect itself by taking:
4. Assertion (A): Marine insurance is a contract of indemnity.
Reason (R): The insured can recover only the actual amount of loss suffered, and he is not allowed to make a profit out of a marine insurance claim.
Reason (R): The insured can recover only the actual amount of loss suffered, and he is not allowed to make a profit out of a marine insurance claim.
5. Assertion (A): In Fire insurance, insurable interest must exist only at the time of taking the policy.
Reason (R): A person can insure a house, sell it to someone else, and still claim the insurance money if the house burns down later.
Reason (R): A person can insure a house, sell it to someone else, and still claim the insurance money if the house burns down later.
SECTION B (3 Marks Each)
6. Differentiate between 'Whole Life Policy' and 'Endowment Policy' in life insurance.
[Case-Based] Mr. A bought a marine insurance policy for his goods being shipped to Dubai. The ship was hit by a torpedo during a sudden war outbreak and sank. The policy only covered 'perils of the sea' (storms, collisions).
7. Will Mr. A get compensation? Explain using the principle of 'Causa Proxima'.
SECTION C (4 Marks Each)
8. Explain the three main types of Marine Insurance (Cargo, Hull, Freight).
[Case-Based] A businessman obtained a fire insurance policy for his godown. Six months later, he sold the godown to his friend. A week after the sale, the godown was destroyed by fire.
9. Can the businessman claim the insurance? Can his friend claim the insurance? Explain the rule of 'Insurable Interest' in Fire Insurance to justify your answer.
SECTION D (6 Marks Each)
[Case-Based] Mr. Dev is a wealthy businessman. He wants to secure his family's future. He visits an insurance agent. He takes out a policy where he has to pay premiums for 20 years, and the company will pay ₹50 Lakhs to his family only upon his death, no matter when it occurs. Furthermore, he and his three business partners take out a single policy covering all four of their lives together, so if any one partner dies, the business gets funds to pay off that partner's legal heirs. Lastly, for his retired father, he deposits a lump sum amount of ₹20 Lakhs with the insurance company so that his father receives a fixed monthly income until he lives.
10. By quoting lines from the paragraph, identify and explain the **three different types of Life Insurance Policies** taken by Mr. Dev.
📄 PRACTICE PAPER - SET 5 (Level: Advanced - Evaluation Competency)
SECTION A (1 Mark Each)
[Case-Based] Which of the following telecom services provides Direct to Home (DTH) television broadcasting?
1.
2. A postal service where the post office collects the price of the goods from the buyer upon delivery and remits it to the seller is called:
[Case-Based] Highly reliable and uninterrupted satellite-based communication services utilized by large corporations and government agencies in remote areas are known as:
3.
4. Assertion (A): E-banking drastically reduces the operating costs for a bank.
Reason (R): It minimizes the need for physical branches and reduces the workload on bank clerks by automating routine transactions.
Reason (R): It minimizes the need for physical branches and reduces the workload on bank clerks by automating routine transactions.
5. Assertion (A): In life insurance, the principle of indemnity is strictly followed.
Reason (R): The insurance company calculates the exact monetary value of a person's life and pays exactly that amount upon death.
Reason (R): The insurance company calculates the exact monetary value of a person's life and pays exactly that amount upon death.
SECTION B (3 Marks Each)
6. Explain 'Value Payable Post' (VPP) and 'Speed Post' as facilities provided by the Indian Postal Department.
[Case-Based] A transport company relies on satellite technology to track its fleet of trucks operating in deep mining areas where mobile network is completely unavailable.
7. Identify this specific telecom service. State one major advantage of this service.
SECTION C (4 Marks Each)
8. Differentiate between 'Life Insurance' and 'Fire Insurance' on the basis of: (a) Subject matter, (b) Element of Investment, (c) Insurable Interest, and (d) Principle of Indemnity.
[Case-Based] A business client wants to send a highly confidential legal document from Delhi to Chennai within 24 hours with guaranteed proof of delivery.
9. Which specific postal or telecom service should he use? Explain any three benefits of telecom services to modern businesses.
SECTION D (6 Marks Each)
[Case-Based] 'Alpha Electronics' operates entirely online. The owner, Mr. Sen, is amazed by the power of e-banking. He pays all his suppliers instantly using RTGS. He never visits a physical bank branch, saving him hours of travel time. He can check his account balance at 2 AM on a Sunday. Furthermore, his customers pay him directly using mobile wallets, eliminating the risk of handling fake currency notes or cash theft. He feels entirely in control of his finances as every transaction leaves a digital trail.
10. By quoting lines from the paragraph, identify and explain any **four benefits of e-banking to the customer (Mr. Sen)** and **two benefits of e-banking to the Bank**.
📄 PRACTICE PAPER - SET 6 (Level: Expert - Complex Case Studies)
SECTION A (1 Mark Each)
[Case-Based] Mr. A takes a medical insurance policy. He answers "No" to the question "Do you smoke?" even though he is a chain smoker. He dies of lung cancer.
1. Which principle did he violate?2. A cheque that is crossed with two parallel lines on the top left corner indicates:
[Case-Based] The bank allows a trusted businessman to overdraw his current account up to ₹50,000 for a period of two months.
3. This short-term credit facility is known as:4. Assertion (A): Services are inseparable from their source.
Reason (R): A doctor cannot be separated from the medical treatment he provides; the service provider must be present when the service is consumed.
Reason (R): A doctor cannot be separated from the medical treatment he provides; the service provider must be present when the service is consumed.
5. Assertion (A): Marine insurance protects against the perils of the sea.
Reason (R): Perils of the sea include natural disasters, collision, fire on board, and theft by pirates.
Reason (R): Perils of the sea include natural disasters, collision, fire on board, and theft by pirates.
SECTION B (3 Marks Each)
6. Explain the term 'Discounting of Bills of Exchange' as a function of commercial banks.
[Case-Based] A factory was insured against fire. A minor fire broke out in the waste bin. The manager intentionally did not extinguish it, hoping it would burn down an old machine so he could claim new one from insurance.
7. Which principle of insurance did the manager violate? Explain the principle.
SECTION C (4 Marks Each)
8. Briefly explain the following telecom services: (a) Cellular Mobile Services, (b) DTH Services.
[Case-Based] Mr. Das took a fire insurance policy of ₹20 Lakhs for his godown. The actual value of the goods was ₹15 Lakhs. A fire destroyed half the goods (loss of ₹7.5 Lakhs). Mr. Das claimed ₹20 Lakhs from the insurance company.
9. How much will the insurance company actually pay him? State the exact principle of insurance that restricts his claim.
SECTION D (6 Marks Each)
[Case-Based] 'Alpha Logistics' transports expensive electronics. One of their delivery trucks, driven by Ram, collided with a car driven recklessly by Shyam. The truck was severely damaged (loss of ₹2 Lakhs). Alpha Logistics claimed the insurance money. The insurance company investigated, paid ₹2 Lakhs to Alpha Logistics in full, and then successfully filed a lawsuit against Shyam (the reckless driver) to recover the ₹2 Lakhs they had paid out. Alpha Logistics later tried to sue Shyam themselves to get another ₹2 Lakhs as "extra compensation."
10. Identify and explain the **specific principle of insurance** under which the insurance company sued Shyam. Based on this principle, can 'Alpha Logistics' legally sue Shyam again for extra compensation? Justify your answer.
📄 PRACTICE PAPER - SET 7 (Level: Expert - Integrated Concepts)
SECTION A (1 Mark Each)
[Case-Based] A business service that cannot be experienced exactly the same way twice (like a haircut) suffers from the characteristic of:
1.
2. A bank account that combines the features of a savings account and a fixed deposit account is called:
3. Assertion (A): Life insurance is not subject to the principle of Subrogation.
Reason (R): The principle of subrogation transfers the rights of the insured to the insurer after compensating the loss. Since human life cannot be compensated financially, subrogation does not apply.
Reason (R): The principle of subrogation transfers the rights of the insured to the insurer after compensating the loss. Since human life cannot be compensated financially, subrogation does not apply.
4. Assertion (A): Insurable interest must exist at the time of taking the policy in Marine Insurance.
Reason (R): In marine insurance, insurable interest must exist only at the time of loss, not necessarily at the time of taking the policy.
Reason (R): In marine insurance, insurable interest must exist only at the time of loss, not necessarily at the time of taking the policy.
5. Which of the following is NOT a core function of the modern Postal Department?
SECTION B (3 Marks Each)
6. Explain 'Multiple Option Deposit Account' (MODS) and its benefits to the account holder.
[Case-Based] A person takes a life insurance policy and names his wife as the nominee. Later, he transfers the policy to his bank as collateral for a massive business loan.
7. Who holds the 'Insurable Interest' in this scenario? Explain the concept of Insurable Interest in life insurance.
SECTION C (4 Marks Each)
8. Discuss the financial facilities (like PLI and PPF) provided by the Indian Postal Department.
[Case-Based] Two warehouses caught fire on the same night. Warehouse A was completely destroyed (loss of ₹10 Lakhs, insured for ₹10 Lakhs). Warehouse B was saved, but goods worth ₹2 Lakhs were ruined by the water used by the fire brigade to extinguish the fire. The insurance policy of Warehouse B covered 'Fire', but the company refused to pay for 'Water damage'.
9. Using the principle of 'Causa Proxima', explain whether the insurance company is liable to pay for the water damage in Warehouse B.
SECTION D (6 Marks Each)
[Case-Based] 'Star Traders' needs various banking facilities. First, they deposit their daily cash collections of ₹5 Lakhs into an account that allows unlimited transactions but gives zero interest. Second, they need a guarantee from their bank to import machinery from Germany, assuring the German seller that payment will be made. Third, to pay their local suppliers quickly without writing paper cheques, they use a digital system that clears transactions in batches every half hour. Fourth, they occasionally need an advance of ₹2 Lakhs for 15 days against the security of their warehouse stock to manage cash flow.
10. Identify and explain the **four distinct banking services/facilities** (Type of Account, Trade Instrument, Fund Transfer System, and Short-term Loan) utilized by 'Star Traders' in the above scenario.
📄 PRACTICE PAPER - SET 8 (Level: Advanced Board Mock 1)
SECTION A (1 Mark Each)
1. The principle that states the insured should not make a profit out of an insurance claim is:
[Case-Based] A bank provides a facility where a customer can deposit a fixed amount every month for a specific period (e.g., 5 years) to earn interest.
2. This account is called:3. Assertion (A): Services suffer from the problem of inventory.
Reason (R): Because services are intangible and perishable, an airline cannot 'store' an empty seat on today's flight to sell it tomorrow.
Reason (R): Because services are intangible and perishable, an airline cannot 'store' an empty seat on today's flight to sell it tomorrow.
4. Assertion (A): A creditor has an insurable interest in the life of his debtor.
Reason (R): The creditor will suffer a financial loss if the debtor dies before repaying the loan.
Reason (R): The creditor will suffer a financial loss if the debtor dies before repaying the loan.
5. The document that contains the terms and conditions of the contract of insurance is called the:
SECTION B (3 Marks Each)
6. Explain the characteristics of 'Intangibility' and 'Inseparability' of services.
[Case-Based] A company takes a marine insurance policy for a shipment of spices. During the voyage, the ship encounters a massive storm. The captain is forced to throw some heavy cargo into the sea to lighten the ship and save it from sinking.
7. Identify the specific marine insurance term for throwing cargo overboard to save the ship. Is the insurance company liable to compensate for this deliberate act?
SECTION C (4 Marks Each)
8. Explain the difference between 'Bank Overdraft' and 'Cash Credit'.
9. Differentiate between 'Life Insurance' and 'Marine Insurance' on the basis of: (a) Subject matter, (b) Duration, (c) Insurable Interest, and (d) Indemnity.
SECTION D (6 Marks Each)
[Case-Based] Mr. Anil insured his factory building worth ₹50 Lakhs. He took Policy A from 'Secure Insure' for ₹30 Lakhs and Policy B from 'SafeGuard' for ₹20 Lakhs. A severe short circuit caused a fire, resulting in a loss of ₹10 Lakhs. Mr. Anil filed a claim for ₹10 Lakhs from 'Secure Insure' and another ₹10 Lakhs from 'SafeGuard', hoping to make a profit of ₹10 Lakhs. 'Secure Insure' paid the full ₹10 Lakhs to Mr. Anil.
10. Based on the insurance principles, answer the following:(a) Identify the **two principles of insurance** violated by Mr. Anil's intention to make a profit.
(b) Since 'Secure Insure' paid the entire loss of ₹10 Lakhs, what legal right do they now have against 'SafeGuard'? Identify the principle.
(c) Calculate the exact monetary amount 'Secure Insure' can recover from 'SafeGuard'. (Show the ratio calculation).
📄 PRACTICE PAPER - SET 9 (Level: Advanced Board Mock 2)
SECTION A (1 Mark Each)
[Case-Based] The amount paid by the insured to the insurer at regular intervals in consideration for the insurance contract is called:
1.
2. A business service that provides protection against the risk of non-payment by a foreign buyer is generally provided by banks through:
3. Assertion (A): Utmost good faith is applicable only to the insured (customer).
Reason (R): The insurer (company) is also bound by utmost good faith and must disclose all terms, conditions, and hidden clauses of the policy to the customer.
Reason (R): The insurer (company) is also bound by utmost good faith and must disclose all terms, conditions, and hidden clauses of the policy to the customer.
4. Assertion (A): An employer has an insurable interest in the life of his key employee.
Reason (R): The sudden death of a key executive can cause a massive financial loss to the company.
Reason (R): The sudden death of a key executive can cause a massive financial loss to the company.
5. Which of the following is NOT a type of bank account?
SECTION B (3 Marks Each)
6. What is a 'Bank Draft'? How does it ensure guaranteed payment?
[Case-Based] Mr. X sells his house to Mr. Y. The house was insured against fire by Mr. X. Two days after the sale, the house catches fire. Mr. Y tries to claim the insurance money from Mr. X's policy.
7. Will the insurance company pay Mr. Y? Explain the relevant principle of Fire Insurance.
SECTION C (4 Marks Each)
8. Explain the concept of 'Insurable Interest'. State when this interest must exist in Life, Fire, and Marine insurance.
9. Explain any four differences between a 'Fixed Deposit Account' and a 'Savings Deposit Account'.
SECTION D (6 Marks Each)
[Case-Based] 'Global Shippers' operates a massive maritime transport business. They load ₹100 Crores worth of wheat onto a ship heading to Europe. The journey involves three massive risks. First, the ship itself might sink due to a storm, causing a ₹500 Crore loss. Second, the wheat might be ruined by seawater. Third, if the ship arrives safely but the European buyer refuses to pay the shipping charges, Global Shippers will lose their profit margin. To protect against all these scenarios, the management approaches a Marine Insurance company.
10. Identify and explain the **three different types of Marine Insurance policies** that 'Global Shippers' must purchase to cover all three specific risks mentioned in the case.
📄 PRACTICE PAPER - SET 10 (Level: Ultimate Board Challenger)
SECTION A (1 Mark Each)
1. Which of the following is an example of 'Inconsistency' (Heterogeneity) in services?
[Case-Based] A person took a life insurance policy. He was asked to fill a medical form. He intentionally hid the fact that he was suffering from a terminal heart disease. He died a month later.
2. The insurance company can refuse to pay the claim under which principle?3. Assertion (A): Under the principle of Subrogation, the insured cannot retain the damaged property after receiving full compensation.
Reason (R): If the insured retains the scrapped property and sells it, he will make a profit, which violates the basic rule of indemnity.
Reason (R): If the insured retains the scrapped property and sells it, he will make a profit, which violates the basic rule of indemnity.
4. Assertion (A): RTGS is mostly used for small, retail, everyday transactions.
Reason (R): RTGS (Real Time Gross Settlement) has a minimum transaction limit of ₹2 Lakhs, making it unsuitable for buying groceries.
Reason (R): RTGS (Real Time Gross Settlement) has a minimum transaction limit of ₹2 Lakhs, making it unsuitable for buying groceries.
5. Which of the following is NOT a fundamental principle of Insurance?
SECTION B (3 Marks Each)
6. Differentiate between 'Banker's Cheque' (Pay Order) and a regular 'Cheque'.
[Case-Based] A warehouse was insured against burglary. During a riot, a mob broke into the warehouse, set it on fire, and stole goods. The insurance policy specifically excluded "losses during riots".
7. Will the insurance company pay for the stolen goods? Explain using the principle of 'Causa Proxima'.
SECTION C (4 Marks Each)
8. Explain the term 'Digital Payments'. State any three modern methods of digital payments used by businesses.
9. "The basic purpose of insurance is to spread the loss of a few over many." Elaborate on this statement explaining the fundamental concept of insurance.
SECTION D (6 Marks Each)
[Case-Based] Mr. Dev owned a chemical factory. He insured it against fire for ₹1 Crore. During a weekend, a fire broke out. Mr. Dev was informed, but he lived 10 km away. Instead of rushing to the factory or calling the fire brigade, he stayed home and watched a movie, stating, "It is fully insured, let it burn, I will get a new factory." The factory burnt completely. During the insurance investigation, it was found that Mr. Dev had leased the factory to another person three months ago and had no financial stake left in it at the time of the fire. Furthermore, the insurance company discovered he had intentionally hidden the fact that the factory lacked basic fire extinguishers when he took the policy.
10. The insurance company rejected his claim completely. By quoting lines from the paragraph, identify and explain the **three fundamental principles of insurance** that Mr. Dev blatantly violated.
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