IAI Actuarial Core Principles · Business Management · Professional negligence

A Bengaluru company is advised negligently by its appointed actuary and suffers a loss. The company then fails, without good reason, to take an obvious and inexpensive step that would have avoided most of the loss. In an Indian negligence claim, how is this most likely treated?

The failure to mitigate may reduce the damages. A claimant must take reasonable, inexpensive steps to limit its loss, and cannot recover for the part that could have been reasonably avoided, although the claim itself is not wholly barred.

1. AThe claimant's failure to mitigate may reduce the recoverable damagesCorrect
2. BThe failure has no effect because the actuary was the original wrongdoer
3. CThe claim is barred completely
4. DThe damages are increased because of the actuary's greater skill
5. The failure converts the claim into one for breach of trust