Page 24 - Liability Insurance IC74

The Insurance Times

insured or held in trust. or in custody or control of
the Insured or a person in the service of the insured
or a person in the service of the insured.

In essence, the products liability policy is designed to
indemnify for damage to property of third parties. If the
Insured's products cause damage to his own property
or his, or his employee's custody, there is liability under
the policy.

Q7. Explain the following:
(a) Employer's liability for negligence of employees -

According to the legal doctrine, an employer is liable
for the negligence of his employee. The employer's
liability arises when the following essentials are present:
(i) The relationship of master and servant is established.

This may be determined by considering who pays
the wages and who appoints the employee.
(ii) The act is committed in the course of and within
the scope of employment.

Thus, the employer is definitely held liable if negligence
is involve when an employee performs an authorized
act in an authorized way. However, the employer is
usually held liable if the authorized act is performed in
an unauthorized manner or the act was prohibited within
the scope of employment. Even when the act is

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