Name of company ________

Insurance
Period of review:

Risk Minimum control Standards Extent & period Work paper file Voucing sheet
Sub-process Activity Risk Consequences Audit Approach/controls tested Observations & exceptions
Category (Best practices) of check reference embedded here
Breach of contract terms - High Fines and penalties from All contracts before entering into should be Generally applicable to service companies:
insurance cover specified by customer or termination of the approved by the Insurance team. Identify whether the contracts with
customers not adhered to. contract customers requires the company to take
specific insurance covers with specific
Contractual values.
Contractual
commitments to The top 5 customer contracts should be
commitments
customers reviewed to verify that limits specified by
the contracts are within the blanket
insurance covers. 

No formal risk assessment Medium Certain material losses / risks Formal risk assessment has to be designed Review what is the risk assessment
conducted to identify may not be insured or insured and revisited every year by an authorized undertaken by Insurance department to
Risk assessment insurances required for adequately personnel prior to entering into insurance ensure that adequate coverage is taken for
Risk conducted by industry and generic losses. commitments insurance against all kind of losses. Check
assessment Insurance whether formal risk assessment / risk
department appetite exercise is reviewed and
compared with other peers of the same
industry.

1. Insurance policies not be Medium Higher cost of insurance / poor Three quotes should be invited for 1. Check the alternative quotations and
purchased at fair terms/ service quality of vendor insurance policies and should be approved approvals for the purchasing/ renewal of
Appointment of competitive rates. by an authorized personnel policies.
Policy
insurers and 2. Purchased policies may not 2. Review whether the comparative
purchase
policy purchase be adequately authorized. quotation statement is approved as per
SOA.

No formal process in place for High Lapses resulting in inadequate A complete and comprehensive tracker of Verify the tracker and compare the details
Updates and policy updates / risks or incomplete cover all policies should be maintained and with actual policies for completeness.
renewals are updation / renewal of policies / updated regularly by an authorized
carried out on time adherence to process personnel

Policy
Addition / deletion in assets / Medium Under insurance of the A complete and comprehensive tracker of 1. Review the process of collating input
coverage,
updation & Collating details of employees are not covered Company assets / employees all policies should be maintained and information with regard to various policies
change in adequately updated regularly by an authorized (like employee details, average cash
renewal
employee personnel balance, asset values and locations, etc.)
strength, assets 2. Check that any addition / deletion in
value, location, employees / assets are adequately insured
etc. during the audit period.

Company owned vehicles are Medium Under insurance of Company A complete and comprehensive tracker of Trace the total number of vehicles from the
not adequately insured. assets leads to revenue loss to all insured / uninsured vehicles should be asset base with the insured vehicles.
Vehicle the Company incase of an maintained and updated regularly by an
Vehicle insurance
insurance accident authorized personnel

Current projects are not High Underinsurance of project A complete and comprehensive tracker of Check the insurance coverage for all the
insured adequately assets leads to revenue loss to all completed / ongoing projects should be current on-going projects
Capex projects Project insurance the Company incase of an maintained and updated regularly by an
accident authorized personnel
Incorrect amount of premium Low Revenue loss to the Premium paid should be approved by an Check the premium paid by the Company
paid. Company / wrong presentation authorized personnel and its accounting for the sample months.
Premium payment of premium cost in the financial
Premium statements
payment &
accounting Incorrect accounting of Low Inaccurate financial reporting Premium paid but not due is properly Review the accounting done for premiums
Premium premium paid. reflected under prepaid expense head in paid. Ensure that premium paid but not due
accounting P&L account. is properly reflected under prepaid expense
procedures head.
Under/ Excess Insurance High Loss of assets without Personnel from Unit commercial should be In case of a central insurance department,
adequate exposure coverage. entrusted with the task of collating all these ensure annual return is filed timely with
details. It should be subsequently verified Head office by all factories in different
by Commercial Manager before sending locations. Ensure correct details in annual
the declaration to HO. return:
1. All the assets correctly classified as per
the Asset register.
2. GVB values of all the assets are
declared in the insurance return
3. Insure assets placed at all the location
Insurance are correctly provided.
Fixed Assets
declaration by 4. Ensure specific disclosures are further
insurance
factories to HO provided in case of
a All assets in CWIP status
b. Leased Asset (if unit is supposed to
take insurance as per lease agreement)
c. Dismantled Assets (Unutilized / Idle
Plant/ Machinery/ Equipment)
d. Written off assets ( yet to be disposed
off)
 Risk Minimum control Standards Extent & period Work paper file Voucing sheet
Sub-process Activity Risk Consequences Audit Approach/controls tested Observations & exceptions
Category (Best practices) of check reference embedded here
Under/ Excess Insurance High Loss of assets without Personnel from Unit commercial should be 1. Ensure all the cash balances in excess
adequate exposure coverage. entrusted with the task of collating all these of Rs.5 lacs are insured. Immediate
details. It should be subsequently verified declaration is provided to the HO
by Commercial Manager before sending (Insurance Cell) where ever the balance
the declaration to HO. has exceeded Rs 5 lacs.
2. Cash in safe > Rs 5 lacs and cash in
transit > Rs 3 lacs should be indicated in
Insurance the annual return.
Cash
declaration by 3. Check whether Cash-in-transit has been
insurance
factories to HO adequately insured.
4. Has cash withdrawn for wage
disbursements either been paid or
deposited back into the bank within a
period of 7 days from the date of
withdrawal?

Under/ Excess Insurance High Loss of assets without Personnel from Unit commercial should be Ensure annual return timely filed, Ensure
adequate exposure coverage. entrusted with the task of collating all these correct details in annual return
details. It should be subsequently verified 1. Details should be provided for RM, PM
by Commercial Manager before sending and finished goods in stocks (including
the declaration to HO. damage stocks, dead stock and stocks
held in tanks.
Insurance 2. Insure assets placed at all the location
Inventory declaration by are correctly provided.
factories to HO 3. Stocks stored in the tanks are reported
separately
4.Ensure that any increase > 15 % over
last month closing stocks has been
intimated to HO Insurance.

Under/ Excess Insurance High Loss of assets without Personnel from Unit commercial should be Ensure that stocks lying in Engineering
Insurance adequate exposure coverage. entrusted with the task of collating all these Stores have been adequately insured and
Engineering details. It should be subsequently verified intimated to HO.
declaration by
stores by Commercial Manager before sending
factories to HO
the declaration to HO.
Under/ Excess Insurance Medium Loss of assets without Personnel from Unit commercial should be 1. Ensure monthly returns are filed by the
adequate exposure coverage. entrusted with the task of collating all these units;
details. It should be subsequently verified 2. Ensure any addition/ sale/ write off/
by Commercial Manager before sending transfer is adequately highlighted in the
Insurance
Monthly return the declaration to HO. return for insurance department to re
declaration by
filing assess and obtain the insurance cover
factories to HO
Ensure that any increase > 10 % over last
month closing stocks has been intimated to
HO Insurance

Under/ Excess Insurance High Loss of assets without Personnel from Unit commercial should be Ensure that there is timely communication
Insurance adequate exposure coverage. entrusted with the task of collating all these to HO (Central HR) of list of employees at
Group Medical details. It should be subsequently verified factories that need to be covered by group
declaration by
Insurance by Commercial Manager before sending medical insurance.
factories to HO
the declaration to HO.
1. No insurance obtained for High High loss exposure in absence Formal risk assessment has to be carried 1. Check all the other insurance policies
1.Directors and specific kind of risks. of adequate coverage for out to identify the specific risks facing the entered by the company.
officers 2. Unfavourable terms and specific risks. company, evaluating the potential loss 2. Identify the specific risk covered by it, its
2. Fidelity conditions/ Inadequate impact and taking adequate coverage. adequacy and completeness.
insurance coverage due to special nature 3. Ensure that all the terms and conditions
3. Loss of of these policies. stipulated in the policy are adequately
Other policy profits/business adhered by the company.
risk insurance
4. Insurance for
bad debts
5. Other types of
insurance covers