it contains special features of insurance contract, and factors affecting rate of mortality

1. Life and General insurance
Anilkumar k.y
Department of commerce
sims

2. SPECIAL FEATURES OF INSURANCE CONTRACT
1. Aleatory :
 if one party to a contract might receive considerably more in value than
he or she gives up under the terms of the agreement, the contract is said to
be aleatory.
 Insurance contracts are of this type because, depending upon chance or
any number of uncertain outcomes, the insured may receive substantially
more in claim proceeds than the amount was paid to the insurance
company in the form of premiums.
 On the other hand the insurer could ultimately receive significantly more
amount than the insured party if a claim never filed.

3. 2. Adhesion :
 In a contract of adhesion, one party draws up the contract and
presents it to the other party on a “take it or leave it “ basis;
 the receiving party does not have the option of negotiating revising
or deleting any part or provision of the document.
 Insurance contracts are of this type, because the insurer writes the
contracts and the insured either adheres to it or is denied coverage.

4. 3. Utmost good faith
According to this principle, both the parties (i.e. insured and insurer) should have
faith over each other.
 As a client it is the duty of the insured to disclose all the facts to the insurance
company, any fraud or misrepresentation of facts can result into cancellation
of the contract.
 The insured must disclose all the material facts known to him at the time the
contract is entered into, if the insured fails to disclose all the material facts
relating to the subject matter of insurance, the contract can be avoided by the
insurer

5. 4. Executory
 It is stated in the insurance and agreement that the insurer will only
perform its obligation after certain events takes place ( in other words,
losses occur)
5. Unilateral
insurance contracts are unilateral ; the insured performs the act of paying the
policy premium, and insurer promises to reimburse the insured for any
covered losses that may occur.
It must be noted that once the insured has paid the policy premium, nothing
else is required on his or her part; only insurer has responsible any further
action .
6. Personal contract:
Insurance contracts are usually personal agreements between the insurance
company and the insured, and are not transferable to another person
without the insurer’s consent.

6. 7. Warranties and representations
A warranty is a statement that is considered guaranteed to be true whereas
representation is a statement that is believed to be true to the best of the
other part’s knowledge.
According to the laws of most states and in circumstances the responses that a
person gives on an insurance application are considered to be a
representations, and not warranties.

7. 8. Misrepresentations and concealments
A misrepresentation is a statement, whether written or oral, that is false.
Whereas concealment, on the other hand, is the failure to disclose information
that one clearly knows about.
In order to void a contract, the insurance company must prove that the
applicant misrepresented information and willfully and intentionally
concealed information.

8. 9. Conditional
Insurance contracts are conditional, when a loss is suffered, certain conditions
must be met before the contract can be legally enforced. For example, the
insured must satisfy the condition of submitting to the insurance company
sufficient proof of loss or prove that he or she has an insurable interest in
the persons insured.
10. Fraud
Fraud is a intentional attempt to persuade, deceive or trick someone in an
effort to gain something of value. If an insurance applicant intentionally
lies in order to gain something then it is considered as fraud.
If an applicant misrepresentations some information with no intent for gain ,
then no fraud has occurred.

9. Insurance laws
Insurance laws is the practice of law surrounding insurance, including
insurance policies and claims. It can be broadly broken into three
categories :
 Regulation of the business of insurance
 Regulation of the content of insurance policies
 Regulation of claim handling
Insurance business is governed by a number of acts:
 The first statute in India to regulate the life insurance business was the
indian life assurance companies act,1912
 The insurance act of 1938 was the first legislation governing all forms of
insurance.
 Life insurance in india was completely nationalizes on jan 19 1956,
through the LIC act
 All 245 insurance companies operating in the country were merged into 1
entity, the life insurance corporation of india.

10.  The general insurance business act 1972 was enacted to nationalize the
about 100 general insurance companies.
 Untill 1999, there were no private insurance companies in india . The
government then introduced the IRDA act 1999 to allow private
companies.
 Foreign investment was also allowed and capped at 26% holding in the
Indian insurance companies.
 In 2015 the limit of FDI in insurance sector has been raised to 49%
subject to certain conditions
 A minimum capital of 400 crore is required to set up an insurance
business.

11. INFANT MORTALITY RATE
- the ratio of infant deaths registered in a given year to the
total number of live births registered in the same year;
usually expressed as a rate per 1000 live births.
- it is given by the formula:
Number of deaths of children less
IMR = than one year of age in a year ×1000
Number of live births in the same
year
2 August 2016 11

12. FACTORS AFFECTING RATE OF MORTALITY
Endogenous factors:
I. Biological factors
 Birth weight:
 Age of the mother:
 Birth order
 Birth spacing
 Multiple births
 Family size
 High fertility
 Maturity of an infant at birth:
 Exogenous causes
I. Economic factors
II. Cultural and social
factors
 Breast feeding
 Religion and caste
 Early marriages
 Sex of the child
 Quality of mothering
 Maternal education
 Quality of health care
 Broken families
 Illegitimacy
III.environmental factors
 Lack of proper sunshine
 Lack of Fresh air
 Bad environmental sanitation

13.  infant deaths are grouped into 2 categories according to the
age of death.
 The first category consists of those infants who die before
they complete 4 weeks of life- the rate based on this period
is known as neo-natal mortality rate.
 The other category consists of those infants who die
between 28 days to 365 days of their life- the rate based on
this period is known as post-neo-natal mortality rate.
 Factors which affect foetal and neo-natal deaths are
primarily endogenous, and factors which affect post-neo-
natal deaths are primarily exogenous.

14. 1. Endogenous factors:
The endogenous factors are related to foetal (i.e. the
formation of the foetus in the womb) and neo-natal
deaths. Mainly caused by biological factors.
I. BIOLOGICAL FACTORS
(a) Birth weight:
- babies of low birth weight
and high birth weight are at special risk.
- causes: poor nutrition during pregnancy..
(b) Age of the mother:
- IMR are greater when the mother is either very young or
relatively older.

15. (c) Birth order
- the highest mortality is found among first born, and the
lowest among those born second.
- The risk of infant mortality escalates after the third birth.
- the fate of fifth and later children is always worse than the
fate of the 3rd child.
(d) Birth spacing
- repeated pregnancies- malnutrition and anaemia in the
mother- predispose to LBW..
- prematurely weaned- PEM, diarrhoea and dehydration.

16. (e) Multiple births
- Infants born in multiple births face a greater risk of
death than do those in single births due to the greater
frequency of low birth weight among the former.

17. (f) Family size
- the number of episodes of infectious diarrhea prevalence of
malnutrition, and severe respiratory infections have been
found to increase with family size.
- fewer children-better maternal care, a better share of family
resources, less morbidity and greatly decreased infant
mortality.
(g) High fertility
high fertility and high infant mortality go together.
(h) Maturity of an infant at birth:

18.  In united states, it was observed that a low birth weight
was the cause of two-thirds of all the neo-natal deaths.
 It may concluded from this discussion that the causes of
feotal and neo-natal deaths so far considered arise mainly
out of genetic factors.

19. 2. Exogenous causes
Social , cultural, economic and environmental factors are
also found to affect infant mortality, especially during the
post neo natal period.
I. ECONOMIC FACTORS
The availability and quality of health care and the nature of
the child’s environment are closely related to socio-
economic status.

20. II. . CULTURAL AND SOCIAL FACTORS
(a)Breast feeding:
Early weaning and bottle-fed infants living under poor
hygienic conditions are more prone to die than the breast-
fed infants living under similar conditions.

21. (b) Religion and caste
The differences are attributed to socio-cultural patterns
of living, involving age-old habits, customs, traditions
affecting cleanliness, eating, clothing, child care and
almost every detail of daily living.
(c) Early marriages
..teen-age mother- greater risk of neonatal and post-
neonatal mortality.

22. (d) Sex of the child
Statistics show that female infant
mortality is higher than the male infant mortality.
(e) Quality of mothering
(f) Maternal education
Women with schooling tend to marry later, delay child-
bearing and are more likely to practice family planning.
Educated women generally do not have early
pregnancies, are able to space their pregnancies,

23. (g) Quality of health care
Shortage of trained personnel like dais, midwives and
health visitors is another determinant of high mortality in
India.
According to estimates only 47% of the deliveries are
attended by trained birth attendants.
(f) Broken families
(g) Illegitimacy

24. III. Environmental factors.
 Lack of proper sunshine
 Lack of Fresh air
 Bad environmental sanitation

25. 2 August 2016 25