Internal Audit Checklist of Insurance Exp.

INSURANCE

Check whether the Insurance policies taken by the company cover the following assets at all the
locations (factories, offices, branches etc).
o Plant & Machinery, Furniture / Fixtures, Electrical installation, Office equipments etc
o Buildings / Warehouses etc.
o Inventories / Stocks in transit
o Cash
o Vehicles
o Any other.

Ensure that the value of Assets insured is adequate.

Ensure that all the risks are covered in the policy.

Check whether the loss of profits policy has been taken by the company.

Ensure that the additions / deletions to the fixed assets during a particular accounting year are fully
taken care of in the policy.

Check whether the insurance premium amount has been properly negotiated. Ensure that
competitive rates of 2-3 insurance companies were taken into consideration while finalizing the
premium payable. For this purpose all necessary precautions should be taken to reduce the level of
premium.

Obtain a list of all the insurance claims pending for settlement as on a particular date and comment
upon the old pending cases.

Obtain a list / statement of all the Insurance policies and ensure that all the assets of the company are
fully insured.

Ensure that the value of assets / fixed assets declared by the company is proper and that the assets
are not under covered.

Ensure that maximum discounts / rebates were availed by the company at the time of finalizing the
insurance policies / premium.

Check whether insurance policies in respect of group Gratuity / Medical / Superannuation / accident
etc. are obtained at the best rates. Comparative statements / comparative data should be checked.

Ensure that the Insurance policies are renewed in time i.e. before the expiry of the period of validity.

Check the list of fixed assets / assets filed with the insurance company to ensure that all the Fixed
assets / assets are covered by the insurance policies.

Ensure that all the policies are obtained for the uniform period matching with the accounting year of
the company.

Check whether the terms and conditions given in the insurance policy are complied with by the
company.