This document provides an overview of general insurance. It begins with an introduction that defines general insurance as non-life insurance that covers property, personal accidents, liability, and other risks. It then lists the main types of general insurance like fire, motor, health, and burglary insurance. The rest of the document discusses the principles and regulations governing general insurance in India, including utmost good faith, insurable interest, indemnity, and subrogation. It provides details on key concepts like the nature of insurance contracts and the statutes that regulate the general insurance industry in India.
General Insurance is defined as any insurance which is not determined as life insurance. There are various types of general insurance. Know about them here.
1. A vessel carrying segregated gasoline and gasoil cargoes was found to have off-specification gasoil upon arrival at the discharge port due to a contaminated flash point.
2. Testing revealed the double valve segregation between cargo tanks was not in place, allowing for a vapour phase contamination from the gasoline to impact the higher flash point gasoil.
3. Further gas chromatography–mass spectrometry testing of cargo samples identified the source of contamination as vapors from the gasoline cargo affecting the gasoil through the common inert gas system when segregation was breached.
Marine insurance is the oldest branch of insurance that covers marine cargo and marine hull. It provides protection to cargo during transit by road, rail, sea, and air. The insurance commences from when goods are dispatched and covers them until delivery at the final destination or for up to 60 days after unloading from a vessel. Major requirements for marine cargo export insurance include the invoice value and voyage details. Standard clauses set by Lloyd's of London are used worldwide in marine export and import policies.
This document provides an overview of fire insurance. It discusses key concepts such as utmost good faith, indemnity, insurable interest, and subrogation. It describes what can be covered by fire insurance including buildings, machinery, goods, and household contents. It also summarizes different types of fire insurance policies such as specific insurance, floating insurance, and standing insurance.
This document outlines 8 key principles of insurance:
1) Insurable interest requires the insured to have a financial stake in the insured property/subject.
2) Uberrima fidei requires utmost good faith, where fraud or misrepresentation can void the contract.
3) Material facts must be disclosed about the insured property/subject.
4) Indemnity provides compensation to return the insured to their pre-loss status, without the potential for profit.
5) Contribution prevents double recovery where multiple insurance applies to the same loss.
6) Subrogation allows the insurer to recover costs from liable third parties.
7) Loss minimization requires the insured take reasonable steps to reduce
Lecture slide chapter 2 insurance and risk managementDashing Shithil
The document provides an overview of key concepts in insurance contracts and principles. It discusses:
1. The nature of insurance as an aleatory contract between an insurer and insured based on principles of utmost good faith and indemnity.
2. Key principles of insurance contracts including insurable interest, utmost good faith, indemnity, subrogation, warranties, proximate cause, return of premium, and assignment.
3. Elements of a valid contract including offer/acceptance, consideration, competency, and lawful object.
4. Distinct characteristics of insurance contracts and methods of providing indemnity for losses.
This presentation discusses reinsurance and its role in the insurance industry. Reinsurance allows insurance companies to transfer some of the risks they insure to other insurers, similar to how individuals purchase insurance policies. This helps insurance companies compensate for future losses from claims and stabilize their loss experience. The presentation defines reinsurance and outlines the various parties involved, methods used, benefits, and some challenges for reinsurance in India.
The document discusses the insurance sector in India. It explains that insurance transfers risk from the insured to the insurer in exchange for premiums. The main types of insurance are life insurance and general insurance. The regulatory body IRDAI was established in 1999 to regulate and develop the insurance industry in India and opened the sector to private companies. Major players in life insurance include LIC, ICICI Prudential, and SBI Life. In general insurance, major players are New India Assurance, National Insurance, and HDFC Ergo. The insurance sector has grown significantly since liberalization and is projected to reach $280 billion by 2020.
General Insurance is defined as any insurance which is not determined as life insurance. There are various types of general insurance. Know about them here.
1. A vessel carrying segregated gasoline and gasoil cargoes was found to have off-specification gasoil upon arrival at the discharge port due to a contaminated flash point.
2. Testing revealed the double valve segregation between cargo tanks was not in place, allowing for a vapour phase contamination from the gasoline to impact the higher flash point gasoil.
3. Further gas chromatography–mass spectrometry testing of cargo samples identified the source of contamination as vapors from the gasoline cargo affecting the gasoil through the common inert gas system when segregation was breached.
Marine insurance is the oldest branch of insurance that covers marine cargo and marine hull. It provides protection to cargo during transit by road, rail, sea, and air. The insurance commences from when goods are dispatched and covers them until delivery at the final destination or for up to 60 days after unloading from a vessel. Major requirements for marine cargo export insurance include the invoice value and voyage details. Standard clauses set by Lloyd's of London are used worldwide in marine export and import policies.
This document provides an overview of fire insurance. It discusses key concepts such as utmost good faith, indemnity, insurable interest, and subrogation. It describes what can be covered by fire insurance including buildings, machinery, goods, and household contents. It also summarizes different types of fire insurance policies such as specific insurance, floating insurance, and standing insurance.
This document outlines 8 key principles of insurance:
1) Insurable interest requires the insured to have a financial stake in the insured property/subject.
2) Uberrima fidei requires utmost good faith, where fraud or misrepresentation can void the contract.
3) Material facts must be disclosed about the insured property/subject.
4) Indemnity provides compensation to return the insured to their pre-loss status, without the potential for profit.
5) Contribution prevents double recovery where multiple insurance applies to the same loss.
6) Subrogation allows the insurer to recover costs from liable third parties.
7) Loss minimization requires the insured take reasonable steps to reduce
Lecture slide chapter 2 insurance and risk managementDashing Shithil
The document provides an overview of key concepts in insurance contracts and principles. It discusses:
1. The nature of insurance as an aleatory contract between an insurer and insured based on principles of utmost good faith and indemnity.
2. Key principles of insurance contracts including insurable interest, utmost good faith, indemnity, subrogation, warranties, proximate cause, return of premium, and assignment.
3. Elements of a valid contract including offer/acceptance, consideration, competency, and lawful object.
4. Distinct characteristics of insurance contracts and methods of providing indemnity for losses.
This presentation discusses reinsurance and its role in the insurance industry. Reinsurance allows insurance companies to transfer some of the risks they insure to other insurers, similar to how individuals purchase insurance policies. This helps insurance companies compensate for future losses from claims and stabilize their loss experience. The presentation defines reinsurance and outlines the various parties involved, methods used, benefits, and some challenges for reinsurance in India.
The document discusses the insurance sector in India. It explains that insurance transfers risk from the insured to the insurer in exchange for premiums. The main types of insurance are life insurance and general insurance. The regulatory body IRDAI was established in 1999 to regulate and develop the insurance industry in India and opened the sector to private companies. Major players in life insurance include LIC, ICICI Prudential, and SBI Life. In general insurance, major players are New India Assurance, National Insurance, and HDFC Ergo. The insurance sector has grown significantly since liberalization and is projected to reach $280 billion by 2020.
Concept and principle of insurance and its revelent in developing country and...Ravi kumar
Insurance is a contract where one party agrees to compensate the other for potential future losses in exchange for regular payments. There are various types of insurance contracts that provide coverage for personal liability, property, and guarantees. Insurance serves important functions like providing certainty against risks, allowing for risk sharing, and preventing and mitigating losses. Key principles of insurance include cooperation between parties, assessing probabilities of losses, requirements for insurable interest, indemnification of losses, subrogation, and utmost good faith. Insurance is relevant for individuals by providing safety, security, and encouraging savings, and it's relevant for businesses and society by helping with economic growth and protecting wealth.
Insurance is a social device for spreading the chance of financial loss among
a large number of people. Insurance protects against pure risk.
Risk is the possibility of losing economic security.
Risk can be of two kinds: speculative or pure And only pure risks are insurable
Pure risk involves only two possible outcomes:
loss or no loss, with no possibility of gain or profit
Speculative Risk
involves three possible outcomes: loss, no loss or profit
The Law of Large Numbers:
The average of the results obtained from a large number of trials should
be close to the expected value.
Underwriting:
The process of selecting certain types of risks that have historically
produced a profit.
Peril:
A potential cause of loss. Accident, fire, and theft are common perils.
Hazard:
Anything that increases the seriousness of a loss or increases
the likelihood that a loss will occur.
Adverse Selection:
Is the tendency of person with a higher than average chance
of loss to seek insurance at the average state, which if not
Controlled by underwriting, result in higher than expected
Loss levels.
Insurance is not same as gambling. Gambling is creat a new
speculative risk and socially is unproductive but insurance
Deals with pure risk and socially is productive.
Insurance is not same as hedging. Insurance involves the
Transfer of pure risk and reduce objective risk but hedging
Involves just the transfer of speculative risk not risk
Reduduction.
Types of Insurance:
Private insurance, consist of health insurance, property and
liabilty insurance.
Government Insurance, cnosist of social insurance and other
Government insurance programs.
How does insurance work?
You pay a fee called a premium, and in exchange,
the insurance company agrees to pay you a certain
amount of money
-Basic Characteristics Of Insurance
Pooling of losses
Payment of fortuitous losses
Risk transfer
Indemnification
-Pooling of losses
Spreading of losses incurred by the few over the entire group.
• Key mechanism is “law of large number”.
• Future losses are predicted based on law of large number.
Note
• Pooling of loss is the spreading of losses incurred by the few over the
entire group so that in the process average loss is substituted for actual loss.
• The primary purpose of pooling is to reduce the variation in possible
Outcomes , which reduces risk.
-Payment of fortuitous losses
A fortuitous loss is one that is unforeseen and
unexpected and occurs as a result of chance.
Insurance policies do not cover intentional losses
-Risk Transfer
Risk transfer means that a pure risk is transferred from
the insured to the insurer,who typically is in a stronger
Financial position to pay the loss than the insured.
-Indemnification
Means that the insured is restored to his or her approximate
financial position prior to the occurrence of the loss.
- Insurable Risk
Insurer normally insure only pure risk.
Insurance protects individuals and businesses from financial loss by paying compensation for damage to or loss of valuable property and assets. It works by pooling risks among many policyholders, so that the costs of claims made by a few are shared among all. There are important principles that govern insurance, such as insurable interest, utmost good faith, indemnity, contribution, subrogation and average clauses.
The most popular and applicable Asset Insurance policy probably in the world. Cover your belongings against the risk of Fire, Earthquake and other Natural Calamities, Riots, Stikes and Malicious Damage. Get a quick quote by submitting your requirement at https://squareinsurance.in/contact
ULIPs are innovative forms of life insurance that provide safety of your insurance cover with wealth enhancement opportunities. For more information visit - www.aegonreligare.com/ulip/ulip.php
Directors and officers (D&O) liability insurance protects directors and officers from legal liabilities arising from their managerial duties. Some key risks include regulatory investigations, shareholder lawsuits, and employment claims. Successful claims can cost millions in legal fees and damages. It is important for companies to carefully consider their D&O coverage needs, key policy terms and exclusions, and ongoing risks from mergers or director retirements. Purchasing adequate D&O insurance can help protect personal assets and support good corporate governance.
This document provides an introduction to insurance, including its history and evolution. It discusses how insurance works by pooling risks and premiums to compensate losses. It outlines some key risk management techniques like risk avoidance, retention, reduction and financing. Specifically, it explains how insurance transfers risk by having many policyholders pay premiums into a common fund that is then used to pay claims of those who suffer losses from insured events. The document provides examples of early insurance practices throughout history and the development of the insurance industry in India.
This document provides an introduction and overview of marine insurance. It discusses the history and origins of marine insurance in ancient Greece, Rome, and Italy. It defines the nature and scope of marine insurance as covering losses related to ships, cargo, and transportation by sea. The document then outlines the main types of marine insurance, including hull insurance, cargo insurance, freight insurance, and marine liability insurance. It also mentions different types of marine insurance policies like voyage policies, time policies, and mixed policies.
General insurance provides coverage for various risks and eventualities to protect assets and health from financial loss. The main types of general insurance discussed in the document are car, health, travel, personal accident, and home insurance. Car insurance is compulsory in India and covers risks like natural disasters, accidents, and third party liability. Health insurance covers expensive medical costs for accidents, illnesses, and surgeries. Travel insurance protects against costs for medical issues, trip delays, lost luggage, and trip cancellations while traveling. Personal accident insurance provides benefits for death, disability, or dismemberment from an accident. Home insurance protects against property damage or loss of possessions from events like fires or natural disasters.
The document discusses motor insurance policies in India. It introduces different types of motor insurance policies including liability-only and comprehensive policies. It describes key elements of motor insurance policies like third party liability coverage, own damage coverage, no claim bonus, and standard policy wordings as per the All India Motor Tariff. It also provides an overview of own damage claims process and settlements.
This document discusses insurable interest, which refers to an interest in an item or event that, if lost or damaged, would result in financial loss to the insured party. It provides definitions of insurable interest from various sources and outlines some key points:
- Insurable interest must exist at the time a policy is taken out for life and fire insurance, but only at the time of loss for marine insurance.
- Close relatives, owners, and those with contractual relationships like creditors/debtors typically have insurable interest in lives. Owners and those with pecuniary interests have insurable interest in property.
- Insurable interest prevents gambling by requiring the insured party to have actual risk of financial loss
Insurance Companies- Accounting and Statutory Requirements -ICICI LombardNikita Jangid
This document provides an overview of insurance in India, including:
1) It discusses the history and evolution of insurance in India from early references in ancient texts to the current system with both public and private sector organizations.
2) It outlines the key milestones in the development of insurance regulation and the nationalization and privatization of different sectors over time.
3) It describes the current legal structure and regulatory authorities that govern the insurance market in India.
Fire insurance protects people from financial losses caused by fires. It involves sharing fire-related losses incurred by some through contributions to a common fund by all who are exposed to fire risk. Fire insurance pays for losses that are unexpected and occur due to chance. It aims to restore the insured's financial position prior to the loss through the principle of indemnity.
The document provides an overview of how insurance works. It explains that insurance involves individuals pooling funds through premium payments to cover losses experienced by a few. When many individuals face the same risks, insurance allows for losses to be shared across the community in a manageable way for all. Premiums collected are invested, and surpluses are used to pay future claims or returned to policyholders. Examples illustrate how insurance protects against risks of fire or death by having many share the costs of losses affecting a few.
The document provides an overview of various life insurance products and concepts in India. It discusses key terms like insurance, life insurance, types of life insurance policies including whole life, term, and endowment plans. It also covers principles of insurance like insurable interest, utmost good faith, and indemnity. Finally, it summarizes popular individual and group insurance products offered by major Indian and global life insurance companies.
Burglary insurance originated in 1887 at Lloyds in London to cover losses due to theft, robbery, or larceny. It is an important add-on insurance policy for small businesses to protect their livelihoods and property. Burglary insurance covers various classes of theft including residence theft, bank burglary, safe deposit box losses, and interior office and store robbery.
The document provides an introduction to key concepts and terminology in insurance law, including the definition of risk, risk management, insurance terminology such as policies and premiums, the concept of risk pooling, classifications of insurance, and the requirement of insurable interest. It also summarizes the nature of insurance contracts as governed by contract law and regulated by states, how applications and provisions work, and types of defenses insurers can raise.
This document provides an overview of motor insurance in the United Arab Emirates (UAE). It discusses the five main types of car insurance policies available in the UAE, including mandatory third party liability coverage and various comprehensive policies. It also outlines important factors that determine insurance premiums, such as the driver's age and the car's brand/model. The document concludes by introducing a sample motor insurance policy template for the UAE.
This document summarizes a presentation on the Insurance Regulatory and Development Authority of India (IRDA). It discusses what insurance is, the roles of insurers and insured. It outlines the evolution and nationalization of insurance in India. It describes the organizational structure, duties, and tenure of IRDA. It discusses ombudsmen for handling complaints, intermediaries like agents and brokers, and recent regulatory changes and criticisms of IRDA.
This document provides an overview of insurance in India, including the main types of insurance policies, how insurance works, and its importance. It discusses life, health, car, education, home, and general insurance policies. It explains elements of an insurance contract, how insurance protects against uncertainties, and how the insurance sector contributes to economic growth by providing stability and savings opportunities. Insurance allows individuals and businesses to protect themselves from financial losses from various risks through a system where premiums from many are used to compensate the few who suffer losses.
The document provides an overview of insurance concepts including the definition of insurance, features of insurance contracts, need for insurance, objectives of insurance contracts, insurable risks, legal aspects of insurance contracts, types of insurance policies, and reinsurance. It defines insurance as a contract where an individual or organization receives financial protection and reimbursement of damages from an insurer in exchange for payment of a premium. Key features of insurance include risk sharing among a large number of insured persons, payment on a contingency or insurable event, and payment of a premium. [END SUMMARY]
Concept and principle of insurance and its revelent in developing country and...Ravi kumar
Insurance is a contract where one party agrees to compensate the other for potential future losses in exchange for regular payments. There are various types of insurance contracts that provide coverage for personal liability, property, and guarantees. Insurance serves important functions like providing certainty against risks, allowing for risk sharing, and preventing and mitigating losses. Key principles of insurance include cooperation between parties, assessing probabilities of losses, requirements for insurable interest, indemnification of losses, subrogation, and utmost good faith. Insurance is relevant for individuals by providing safety, security, and encouraging savings, and it's relevant for businesses and society by helping with economic growth and protecting wealth.
Insurance is a social device for spreading the chance of financial loss among
a large number of people. Insurance protects against pure risk.
Risk is the possibility of losing economic security.
Risk can be of two kinds: speculative or pure And only pure risks are insurable
Pure risk involves only two possible outcomes:
loss or no loss, with no possibility of gain or profit
Speculative Risk
involves three possible outcomes: loss, no loss or profit
The Law of Large Numbers:
The average of the results obtained from a large number of trials should
be close to the expected value.
Underwriting:
The process of selecting certain types of risks that have historically
produced a profit.
Peril:
A potential cause of loss. Accident, fire, and theft are common perils.
Hazard:
Anything that increases the seriousness of a loss or increases
the likelihood that a loss will occur.
Adverse Selection:
Is the tendency of person with a higher than average chance
of loss to seek insurance at the average state, which if not
Controlled by underwriting, result in higher than expected
Loss levels.
Insurance is not same as gambling. Gambling is creat a new
speculative risk and socially is unproductive but insurance
Deals with pure risk and socially is productive.
Insurance is not same as hedging. Insurance involves the
Transfer of pure risk and reduce objective risk but hedging
Involves just the transfer of speculative risk not risk
Reduduction.
Types of Insurance:
Private insurance, consist of health insurance, property and
liabilty insurance.
Government Insurance, cnosist of social insurance and other
Government insurance programs.
How does insurance work?
You pay a fee called a premium, and in exchange,
the insurance company agrees to pay you a certain
amount of money
-Basic Characteristics Of Insurance
Pooling of losses
Payment of fortuitous losses
Risk transfer
Indemnification
-Pooling of losses
Spreading of losses incurred by the few over the entire group.
• Key mechanism is “law of large number”.
• Future losses are predicted based on law of large number.
Note
• Pooling of loss is the spreading of losses incurred by the few over the
entire group so that in the process average loss is substituted for actual loss.
• The primary purpose of pooling is to reduce the variation in possible
Outcomes , which reduces risk.
-Payment of fortuitous losses
A fortuitous loss is one that is unforeseen and
unexpected and occurs as a result of chance.
Insurance policies do not cover intentional losses
-Risk Transfer
Risk transfer means that a pure risk is transferred from
the insured to the insurer,who typically is in a stronger
Financial position to pay the loss than the insured.
-Indemnification
Means that the insured is restored to his or her approximate
financial position prior to the occurrence of the loss.
- Insurable Risk
Insurer normally insure only pure risk.
Insurance protects individuals and businesses from financial loss by paying compensation for damage to or loss of valuable property and assets. It works by pooling risks among many policyholders, so that the costs of claims made by a few are shared among all. There are important principles that govern insurance, such as insurable interest, utmost good faith, indemnity, contribution, subrogation and average clauses.
The most popular and applicable Asset Insurance policy probably in the world. Cover your belongings against the risk of Fire, Earthquake and other Natural Calamities, Riots, Stikes and Malicious Damage. Get a quick quote by submitting your requirement at https://squareinsurance.in/contact
ULIPs are innovative forms of life insurance that provide safety of your insurance cover with wealth enhancement opportunities. For more information visit - www.aegonreligare.com/ulip/ulip.php
Directors and officers (D&O) liability insurance protects directors and officers from legal liabilities arising from their managerial duties. Some key risks include regulatory investigations, shareholder lawsuits, and employment claims. Successful claims can cost millions in legal fees and damages. It is important for companies to carefully consider their D&O coverage needs, key policy terms and exclusions, and ongoing risks from mergers or director retirements. Purchasing adequate D&O insurance can help protect personal assets and support good corporate governance.
This document provides an introduction to insurance, including its history and evolution. It discusses how insurance works by pooling risks and premiums to compensate losses. It outlines some key risk management techniques like risk avoidance, retention, reduction and financing. Specifically, it explains how insurance transfers risk by having many policyholders pay premiums into a common fund that is then used to pay claims of those who suffer losses from insured events. The document provides examples of early insurance practices throughout history and the development of the insurance industry in India.
This document provides an introduction and overview of marine insurance. It discusses the history and origins of marine insurance in ancient Greece, Rome, and Italy. It defines the nature and scope of marine insurance as covering losses related to ships, cargo, and transportation by sea. The document then outlines the main types of marine insurance, including hull insurance, cargo insurance, freight insurance, and marine liability insurance. It also mentions different types of marine insurance policies like voyage policies, time policies, and mixed policies.
General insurance provides coverage for various risks and eventualities to protect assets and health from financial loss. The main types of general insurance discussed in the document are car, health, travel, personal accident, and home insurance. Car insurance is compulsory in India and covers risks like natural disasters, accidents, and third party liability. Health insurance covers expensive medical costs for accidents, illnesses, and surgeries. Travel insurance protects against costs for medical issues, trip delays, lost luggage, and trip cancellations while traveling. Personal accident insurance provides benefits for death, disability, or dismemberment from an accident. Home insurance protects against property damage or loss of possessions from events like fires or natural disasters.
The document discusses motor insurance policies in India. It introduces different types of motor insurance policies including liability-only and comprehensive policies. It describes key elements of motor insurance policies like third party liability coverage, own damage coverage, no claim bonus, and standard policy wordings as per the All India Motor Tariff. It also provides an overview of own damage claims process and settlements.
This document discusses insurable interest, which refers to an interest in an item or event that, if lost or damaged, would result in financial loss to the insured party. It provides definitions of insurable interest from various sources and outlines some key points:
- Insurable interest must exist at the time a policy is taken out for life and fire insurance, but only at the time of loss for marine insurance.
- Close relatives, owners, and those with contractual relationships like creditors/debtors typically have insurable interest in lives. Owners and those with pecuniary interests have insurable interest in property.
- Insurable interest prevents gambling by requiring the insured party to have actual risk of financial loss
Insurance Companies- Accounting and Statutory Requirements -ICICI LombardNikita Jangid
This document provides an overview of insurance in India, including:
1) It discusses the history and evolution of insurance in India from early references in ancient texts to the current system with both public and private sector organizations.
2) It outlines the key milestones in the development of insurance regulation and the nationalization and privatization of different sectors over time.
3) It describes the current legal structure and regulatory authorities that govern the insurance market in India.
Fire insurance protects people from financial losses caused by fires. It involves sharing fire-related losses incurred by some through contributions to a common fund by all who are exposed to fire risk. Fire insurance pays for losses that are unexpected and occur due to chance. It aims to restore the insured's financial position prior to the loss through the principle of indemnity.
The document provides an overview of how insurance works. It explains that insurance involves individuals pooling funds through premium payments to cover losses experienced by a few. When many individuals face the same risks, insurance allows for losses to be shared across the community in a manageable way for all. Premiums collected are invested, and surpluses are used to pay future claims or returned to policyholders. Examples illustrate how insurance protects against risks of fire or death by having many share the costs of losses affecting a few.
The document provides an overview of various life insurance products and concepts in India. It discusses key terms like insurance, life insurance, types of life insurance policies including whole life, term, and endowment plans. It also covers principles of insurance like insurable interest, utmost good faith, and indemnity. Finally, it summarizes popular individual and group insurance products offered by major Indian and global life insurance companies.
Burglary insurance originated in 1887 at Lloyds in London to cover losses due to theft, robbery, or larceny. It is an important add-on insurance policy for small businesses to protect their livelihoods and property. Burglary insurance covers various classes of theft including residence theft, bank burglary, safe deposit box losses, and interior office and store robbery.
The document provides an introduction to key concepts and terminology in insurance law, including the definition of risk, risk management, insurance terminology such as policies and premiums, the concept of risk pooling, classifications of insurance, and the requirement of insurable interest. It also summarizes the nature of insurance contracts as governed by contract law and regulated by states, how applications and provisions work, and types of defenses insurers can raise.
This document provides an overview of motor insurance in the United Arab Emirates (UAE). It discusses the five main types of car insurance policies available in the UAE, including mandatory third party liability coverage and various comprehensive policies. It also outlines important factors that determine insurance premiums, such as the driver's age and the car's brand/model. The document concludes by introducing a sample motor insurance policy template for the UAE.
This document summarizes a presentation on the Insurance Regulatory and Development Authority of India (IRDA). It discusses what insurance is, the roles of insurers and insured. It outlines the evolution and nationalization of insurance in India. It describes the organizational structure, duties, and tenure of IRDA. It discusses ombudsmen for handling complaints, intermediaries like agents and brokers, and recent regulatory changes and criticisms of IRDA.
This document provides an overview of insurance in India, including the main types of insurance policies, how insurance works, and its importance. It discusses life, health, car, education, home, and general insurance policies. It explains elements of an insurance contract, how insurance protects against uncertainties, and how the insurance sector contributes to economic growth by providing stability and savings opportunities. Insurance allows individuals and businesses to protect themselves from financial losses from various risks through a system where premiums from many are used to compensate the few who suffer losses.
The document provides an overview of insurance concepts including the definition of insurance, features of insurance contracts, need for insurance, objectives of insurance contracts, insurable risks, legal aspects of insurance contracts, types of insurance policies, and reinsurance. It defines insurance as a contract where an individual or organization receives financial protection and reimbursement of damages from an insurer in exchange for payment of a premium. Key features of insurance include risk sharing among a large number of insured persons, payment on a contingency or insurable event, and payment of a premium. [END SUMMARY]
The document discusses the significance of insurance. It provides 3 key points:
1. Insurance provides safety and security against sudden losses by offering financial support. It reduces uncertainties in business and life.
2. Insurance generates financial resources by collecting premiums which are invested and used for economic development, creating employment opportunities and capital formation.
3. Life insurance encourages savings by enabling systematic savings through regular premium payments and providing an investment option. The insured receives a lump sum at maturity.
PPT on insurance for students. I have explained main types of insurance in this PPT. Hope you will find it beneficial and Useful. If you like my presentation then do comment. I will make more PPT's for you like this. Thank You.
Questions for Review and Discussion 1. What is risk management an.pdfAJAYTRADERSKOTA
Questions for Review and Discussion 1. What is risk management and what is the purpose of
insurance? 2. What are the contractual elements of an insurance agreement? 3. Why is insurable
interest so important? 4. What are the differences among types of life insurance? 5. How does
insurable interest differ with life insurance and property insurance? 6. What is a coinsurance
clause: 7. What coverage is given by fire, marine, homeowner\'s, renter\'s, and flood insurance?
8. What differences exist among the of automobile insurance? 9. What benefits are included in
health insurance policies? What are the steps in applying for, obtaining, and maintaining an
insurance policy?
Solution
1)Risk Management : Risk management involves the practice of understanding potential risks of
future, analyzing in details and taking accurate steps to minimise it.
Purpose of insurance :
Damage to, or the loss of, physical assets
Illness,Sudden Death of key members
Compensation claims against the business
Business interruption caused by external events such as terrorism
Volatility and cash flow pressures following an incident
2) Conractual Eleements of Insurance agreement :
Offer? ,Acceptance , Intention of legal consequences ,Consideration
3)Insurable Interset -
The insurable interest requires at the time the policy purchasing People can sell life insurance
policy in a \"life settlement\" transaction. Life settlement means the sale, assignment, transfer, or
bequest of the death benefit or ownership of a life insurance policy by the owner of the policy.
Owner of the policy collects cash and the life settlement company becomes the new owner and
beneficiary of the policy and is responsible for the payment of all future premiums. Upon the
death of the insured, the death benefit is paid to the life settlement company.
4) Differences among type of Life insurance :
Term insurance : the most basic form of life insurance
Endowment plans:maturity benefit
Unit linked insurance plans (ULIP): Pay out the sum assured on death/maturity
Whole life policy:Policy covers a policyholder over his life
Money back policy:periodic payments over the policy term
5) Insurable interest from Life insurance & proprety insurnace :
Insurable interest exists when an insured person derives a financial or other kind of benefit from
the continuous existence of the insured object
Life Insurnace Insurable interest refers to the right of property to be insured. It may also mean
the interest of a beneficiary of a life insurance policy to prove need for the proceeds.
Property insurance : People have an insurable interest in their property up to the value of the
property, but not more.
6) CoInsurance Clause :
Coinsurance in insurance, is the splitting or spreading of risk among multiple parties.
A co-sharing agreement between the insured and the insurer under a health insurance policy
which provides that the insured will cover a set percentage of the covered costs after the
deductible has been paid. Similar to.
ppt - Business Services.fhfhthghnghngngngngfnasurana1403
1. The document discusses various types of bank accounts and services including savings accounts, current accounts, recurring deposit accounts, fixed deposit accounts, and multiple option deposit accounts. It also discusses key banking services like bank drafts, overdrafts, and cash credits.
2. The main types of insurance discussed are life insurance, fire insurance, marine insurance, and health insurance. For each type, the document outlines some of the key principles, for example noting that life insurance is not a contract of indemnity while fire and marine insurance are.
3. The document also discusses various business services provided by banks, insurance companies, and other sectors. It distinguishes between business, social, and personal services.
Business risks-failures-reorganization-and-liquidation-Felyn Denise Jover
The document discusses various types of risks and insurance. It defines risk as variability in possible outcomes of an event based on chance or uncertainty associated with exposure to loss. There are internal and external risks for organizations. Common risks include strategic, financial, operational, compliance, and natural disaster risks. The document also defines insurance and describes common insurance policies like life, non-life, fire, motor vehicle, and how they can help businesses and individuals manage different risks.
This document provides an overview of insurance law and regulation in India. It defines insurance as a contract between two parties where one party agrees to pay the other in the event of a specified loss or accident. Insurance law governs insurance policies and claims. Regulation ensures fairness, prevents market collapse, and promotes access. The document outlines the need for insurance, classifications of insurance including life, general, and reinsurance. It discusses key concepts such as double insurance, social insurance, workmen's compensation insurance, and third party insurance. Finally, it lists the major acts governing India's insurance sector, including the role of the Insurance Regulatory and Development Authority (IRDA).
An insurance contract is an agreement where an insurance company agrees to compensate the insured for financial losses from specified risks in exchange for premium payments. Key characteristics include indemnifying the exact financial loss, contracts of adhesion drafted by the insurer, and consideration in the form of premiums paid by the insured. Insurance promotes savings, investment, financial security, and protection from risks for individuals and businesses. For a contract to be valid, there must be agreement between competent parties, lawful consideration, a legal purpose, and fulfillment of legal formalities. The principles of utmost good faith, insurable interest, proximate cause, and indemnity also apply to insurance contracts.
THE HIDDEN POWER OF
UNIVERSAL LAWS
Contents
Introduction 2
Chapter - 1 3
The Law of Attraction 3
Chapter 2 4
Your Thoughts Control You 4
Chapter 3 5
Visualize Your Thoughts 5
Chapter 4 5
The Law of Vibration 5
Chapter 5 5
Chapter 6 5
Understanding Karma 5
Chapter 7 6
Chapter 8 7
The Law of Love 7
Chapter 9 7
The Law of Allowing 7
Chapter 10 7
Summary 7
Introduction
In life, there are universal laws that govern everything we do. These laws are so perfect that if you were to align yourself with them, you could have so much prosperity that it would be coming out of your ears. This is because God created the universe in the image and likeness of him. It is failure to follow the universal laws that causes one to fail. The laws that were created consisted of the following: ·
Law of Gratitude: The Law of Gratitude states that you must show gratitude for what you have. By having gratitude, you speed your growth and success faster than you normally would. This is because if you appreciate the things you have, even if they are small things, you are open to receiving more.
Law of Attraction: The Law of Attraction states that if you focus your attention on something long enough you will get it. It all starts in the mind. You think of something and when you think of it, you manifest that in your life. This could be a mental picture of a check or actual cash, but you think about it with an image.
Law of Karma: the Law of Karma states that if you go out and do something bad, it will come back to you with something bad. If you do well for others, good things happen to you. The principle here is to know you can create good or bad through your actions. There will always be an effect no matter what.
Law of Love: the Law of Love states that love is more than emotion or feeling; it is energy. It has substance and can be felt. Love is also considered acceptance of oneself or others. This means that no matter what you do in life if you do not approach or leave the situation out of love, it won't work.
Law of Allowing: The Law of Allowing states that for us to get what we want, we must be receptive to it. We can't merely say to the Universe that we want something if we don't allow ourselves to receive it. This will defeat our purpose for wanting it in the first place.
Law of Vibration: the Law of Vibration states that if you wish on something and use your thoughts to visualize it, you are halfway there to get it. To complete the cycle you must use the Law of Vibration to feel part of what you want. Do this and you'll have anything you want in life.
For everything to function properly there has to be structure. Without structure, our world, or universe, would be in utter chaos. Successful people understand universal laws and apply them daily. They may not acknowledge that to you, but they do follow the laws. There is a higher power and this higher power controls the universe and what we get out of it. People who know this, but wish to direct their own lives, follow
The document discusses life insurance and provides definitions and explanations of key concepts:
- Life insurance is a contract where the insurer agrees to pay a sum of money to the insured or their beneficiaries upon the insured's death or other specified event.
- Both parties have responsibilities - the insurer must pay claims as agreed, while the insured must disclose all relevant information truthfully and pay premiums.
- There are various types of life insurance policies that can provide financial protection or serve as investment vehicles. Life insurance plays an important role in protecting families and encouraging savings.
The document provides an overview of various topics related to insurance. It discusses the introduction and history of insurance in India. It then explains key concepts like the importance of insurance, terms used, the concept of assurance, reinsurance and various principles of insurance like utmost good faith. The document also discusses major players in the Indian insurance sector like LIC and GIC. It provides details about various types of insurance policies including life, health, fire, marine and vehicle insurance.
Insurance, system of insurance accountingsooraj yadav
Insurance involves pooling funds from many insured entities to pay for losses some may incur. It protects insured entities from risk in exchange for a fee dependent on the likelihood and cost of events. There are two main types of insurance - life insurance which pays out on death or maturity, and general insurance like health, auto, or fire insurance which pays depending on financial losses from covered events. Insurance companies make money through underwriting risks and investing premiums paid, while providing protection through claims payments.
This document provides an overview of insurance concepts and types of insurance in India. It defines insurance as a contract where one party agrees to indemnify another for financial losses from uncertain future events in exchange for premium payments. There are two main types of insurance in India - life insurance and general insurance, which includes fire, marine, and miscellaneous. Life insurance protects against risks to life, while fire insurance indemnifies for property damage or loss from fire. Marine insurance covers losses from sea perils during ocean transit.
The document summarizes 10 special features of insurance contracts:
1) Aleatory - Insurance contracts are aleatory in nature as the insured may receive substantially more in claims than premiums paid, depending on chance.
2) Adhesion - Insurance contracts are contracts of adhesion as the insurer writes the contracts and presents them to the insured on a "take it or leave it" basis.
3) Utmost good faith - Both parties must have faith in each other. The insured must disclose all material facts and the insurer must only avoid the contract if the insured intentionally misrepresents or conceals facts.
4) Executory - The insurer only performs its obligations if certain events like losses occur.
Historical Development of Insurance im Ethiopiagetabelete
This document provides an overview of Ethiopian insurance law. It defines insurance as a risk transfer mechanism established by a contract between an insurer and insured. Key points covered include:
- The main principles of insurance contracts including insurable interest, utmost good faith, proximate cause, indemnity, subrogation and contribution.
- The classification of insurance into long-term and general categories.
- Requirements for forming an insurance contract including the necessary parties, offer and acceptance process, and renewal terms.
- An overview of Ethiopian contract law principles like definition, formation, object, and required form as they relate to insurance agreements.
The document provides information on insurance industry in India and related reforms. It discusses the history and evolution of insurance in India from ancient times to modern era. Some key points discussed include:
- Insurance concepts existed in ancient Indian texts and first insurance companies were established in 1818.
- The insurance sector was nationalized in 1956 and 1973 to promote customer interests.
- Reforms since 1999 have opened the sector to private companies and established the IRDA as regulator.
- Today there are 24 general insurance and 23 life insurance companies operating in a growing market.
This document provides an overview of key concepts related to insurance contracts in India. It discusses terminology used in insurance, the nature of insurance contracts as aleatory contracts requiring utmost good faith, key principles like indemnity and proximate cause, types of insurance policies including life, fire, and marine, and concepts like insurable interest, misrepresentation, subrogation, contribution, and commencement of policies.
PRESENTATION ON “ STUDY OF SALES PROMOTION’’ AND “ANALYSIS OF INSURANCE B...Muthoot finance Ltd
Meaning of INSURANCE ,Indian Insurance Industry Overview Types of Insurance ,Examples of INSURANCE Company ,How does insurance work?, tax benefits on insurance
General insurance companies provide financial protection against losses from events like fire, floods or theft. They earn income from premiums paid by policyholders and investment returns. Premiums cover costs like claims payments, expenses and dividends. Investment returns depend on market conditions and vary yearly. Reliance General Insurance offers over 80 insurance products across categories like personal accident, fire, marine, motor, health and travel. It aims to make insurance accessible through branches across India and online services. The company follows quality standards and received ISO 9001:2000 certification.
This document provides information on ratio analysis, including definitions, calculations, and uses of various types of ratios. It discusses profitability ratios, coverage ratios, turnover ratios, financial ratios, and control ratios. For each type of ratio, it provides examples and explanations of important individual ratios calculated within that category, such as gross profit ratio, current ratio, debt-to-equity ratio, and budget variance ratio. The document is intended to help explain ratio analysis and how different financial ratios can be used for analysis and decision making.
The document provides an overview of international finance concepts. It defines international finance as the set of relations for creating and using funds needed for foreign economic activity between international companies and countries. It also discusses key topics such as the foreign exchange market, currency convertibility, international monetary systems, international financial markets, and balance of payments. Methods of international business are also summarized, including exporting, licensing, franchising, foreign direct investment, and joint ventures. Multinational companies and challenges they face are also covered at a high level.
This document provides an overview of management accounting. It defines management accounting as accounting that provides information to management for planning, organizing, and controlling business operations. The document outlines the objectives, nature, and scope of management accounting. It also discusses the roles of management accountants and how management accounting relates to and differs from financial accounting and cost accounting. Key terms covered include financial statements, financial analysis, and ratio analysis.
1. Depreciation is the allocation of the cost of a fixed asset over its useful life. It represents the permanent decline in value of the asset due to usage and age.
2. There are several methods for calculating depreciation, including the straight-line method, diminishing balance method, and annuity method. Reserves are funds set aside from profits to strengthen the financial position and meet unknown future liabilities, while provisions are for known liabilities whose exact amount is uncertain.
3. The key differences between reserves and provisions are that reserves are created from profits to meet unknown liabilities and can be used flexibly, while provisions are for meeting specific known liabilities whose amounts are uncertain.
This document provides an overview of performance appraisal. It discusses definitions of performance appraisal, objectives, steps in the process, traditional and modern methods, and factors that can affect appraisals. Traditional methods include ranking, paired comparison, grading, forced distribution, checklist, and field review. Modern methods include management by objectives, 360-degree feedback, and cost accounting assessments. The document also covers topics like career management, team management, employee motivation, grievances, and discipline in the workplace.
The document discusses various topics related to talent acquisition, training, and development in human resource management. It defines talent acquisition as focusing on finding, attracting, hiring, growing, and retaining top talents. It also outlines the talent acquisition process and common methods used. The document then discusses the importance of training and different training methods, such as on-the-job training and off-the-job training. It also compares training and development and outlines various evaluation methods to assess training effectiveness.
This document provides an overview of recruitment and selection processes within human resource management. It defines recruitment as discovering potential job applicants, while selection involves choosing candidates based on assessing their fit for open positions. The document outlines objectives, methods, sources, advantages/disadvantages, and factors influencing recruitment. It also describes the multi-step selection process, including screening, testing, interviews, investigations, examinations, approval, and final hiring. Key differences between recruitment and selection are that recruitment aims to attract many applicants, while selection aims to choose the best from available candidates through a more intensive rejection-focused process.
Human resource planning involves forecasting future human resource needs and developing policies to address potential problems. It is a continuous process that examines skills needed in the future and develops training programs. Key aspects of HR planning include job analysis to determine job requirements, succession planning to ensure leadership continuity, and managing surpluses and deficits in human resources. Organizations use tools like HR audits and ERP systems to evaluate HR activities and automate business processes for improved efficiency.
This document provides an introduction to human resource management. It defines HRM as managing an organization's workforce in a way that optimizes their skills and abilities to meet organizational goals. While technology can replace some human tasks, humans are still needed for judgment, operation of technology, and continuous development. The objectives of HRM are to maximize employee contributions and productivity while achieving individual and societal goals. Key functions of HRM include strategic planning, staffing, training, compensation, and employee relations. The role of an HR manager is to develop and administer policies to make optimal use of human resources through activities like planning, change management, employee development, and administration.
This document provides an overview of preparing final accounts for a sole proprietorship business. It discusses preparing a trading account, profit and loss account, and balance sheet. It also covers manufacturing accounts, features of these accounts, classifications of assets and liabilities, and various account adjustments like closing stock, outstanding expenses, depreciation, bad debts, and provisions. The key information presented includes the objectives and format of the trading account, profit and loss account, and balance sheet, as well as explanations of common account adjustments made when preparing final accounts.
Here are the corrections to Antony's trial balance:
1) Capital and Drawings are personal accounts so they will have debit and credit balances respectively.
2) Freehold premises and Opening stock are asset accounts so they will have debit balances.
3) Sales, Sales return, Loan from Sharma, Bills Payable are nominal accounts so they will have credit balances.
4) Sundry Debtors, Sundry Creditors, Cash in hand are asset/liability accounts so they will have debit/credit balances respectively.
5) Purchases and Return Outwards are nominal accounts so they will have debit balances.
6) Administration expenses, Wages, Factory expenses are expense accounts so they will have
The document discusses claim management and reinsurance in the insurance industry. It covers topics such as the claim settlement process, types of claims including maturity, death and survival benefits, documents required for different claim types, procedures for settling claims, the role of third party administrators, and qualifications for CEOs and CAOs of third party administrators. It emphasizes the importance of prompt claim settlement and outlines the various stages in assessing, processing and paying out on insurance claims.
This document provides an overview of key concepts in life insurance. It discusses:
- The main types of life insurance policies, including protection policies that provide lump sum payments for specified events, and investment policies that facilitate capital growth.
- Key principles of life insurance, including insurable interest, indemnity, subrogation, contribution, and loss minimization.
- Approaches to assessing insurance needs, such as rule-of-thumb based on income, income replacement to fund lost future earnings, and needs-based to cover expenses.
Introduction
Needs and Role of Accounting
System of Accounting
Branches of Accounting
Objectives of Accounting
Generally Accepted Accounting principles : (Accounting Concepts and Conventions)
Documents in Accounting
The document provides an overview of cost accounting concepts including the nature, scope, objectives, and elements of cost accounting. It defines key terms like cost, expense, loss and discusses the classification of costs based on identifiability, activity, control, time, and normality. It also covers cost accounting concepts, methods of costing including job, batch and process costing, and the advantages and limitations of cost accounting.
This document provides an overview of material and labour cost control. It discusses material control techniques like ABC analysis, VED analysis, inventory levels, and economic order quantity. It describes the steps in material control like purchase requisition, selection of suppliers, and receipt of materials. Pricing methods for material issues like FIFO, LIFO, and average cost are explained. The document also covers labour cost elements like direct and indirect labour. It defines idle time and overtime, and discusses causes of idle time like administrative, productive and economic causes. Time rate and piece rate systems for labour remuneration are introduced.
The document provides an overview of the insurance industry in India, including:
1) A brief history of insurance in India from pre-nationalization to the current scenario.
2) Key details on the current state of the life, non-life, and health insurance sectors in India.
3) Important laws and regulations governing the insurance industry in India such as the Insurance Act, LIC Act, and IRDA Act.
Risk refers to the possibility of loss or an unfavorable outcome from an action or event. It includes two elements - an uncertain outcome and the possibility of an unfavorable result. There are several types of risk including pure risk (loss or no loss), speculative risk (loss, gain, or no change), and fundamental risk that affects large populations. Businesses also face strategic, compliance, operational, financial, and reputational risks. Perils are the causes of potential losses, such as natural events, theft, riots, strikes, accidents, and economic downturns. Hazards increase the severity of losses from perils. Risk management aims to reduce or mitigate risks and losses through insurance and other techniques.
A Strategic Approach: GenAI in EducationPeter Windle
Artificial Intelligence (AI) technologies such as Generative AI, Image Generators and Large Language Models have had a dramatic impact on teaching, learning and assessment over the past 18 months. The most immediate threat AI posed was to Academic Integrity with Higher Education Institutes (HEIs) focusing their efforts on combating the use of GenAI in assessment. Guidelines were developed for staff and students, policies put in place too. Innovative educators have forged paths in the use of Generative AI for teaching, learning and assessments leading to pockets of transformation springing up across HEIs, often with little or no top-down guidance, support or direction.
This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
A review of the growth of the Israel Genealogy Research Association Database Collection for the last 12 months. Our collection is now passed the 3 million mark and still growing. See which archives have contributed the most. See the different types of records we have, and which years have had records added. You can also see what we have for the future.
This presentation includes basic of PCOS their pathology and treatment and also Ayurveda correlation of PCOS and Ayurvedic line of treatment mentioned in classics.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
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বাংলাদেশের অর্থনৈতিক সমীক্ষা ২০২৪ [Bangladesh Economic Review 2024 Bangla.pdf] কম্পিউটার , ট্যাব ও স্মার্ট ফোন ভার্সন সহ সম্পূর্ণ বাংলা ই-বুক বা pdf বই " সুচিপত্র ...বুকমার্ক মেনু 🔖 ও হাইপার লিংক মেনু 📝👆 যুক্ত ..
আমাদের সবার জন্য খুব খুব গুরুত্বপূর্ণ একটি বই ..বিসিএস, ব্যাংক, ইউনিভার্সিটি ভর্তি ও যে কোন প্রতিযোগিতা মূলক পরীক্ষার জন্য এর খুব ইম্পরট্যান্ট একটি বিষয় ...তাছাড়া বাংলাদেশের সাম্প্রতিক যে কোন ডাটা বা তথ্য এই বইতে পাবেন ...
তাই একজন নাগরিক হিসাবে এই তথ্য গুলো আপনার জানা প্রয়োজন ...।
বিসিএস ও ব্যাংক এর লিখিত পরীক্ষা ...+এছাড়া মাধ্যমিক ও উচ্চমাধ্যমিকের স্টুডেন্টদের জন্য অনেক কাজে আসবে ...
1. INSURANCE & RISK MANAGEMENT (BBAA04A52)
Unit - 5:
GENERAL INSURANCE
Dr. J.Mexon ,
Department of Management,
Kristu Jayanti College, Bengaluru.
2. Contents
• Introduction to General Insurance
• Types of General Insurance
• Principles of General Insurance
• Fire Insurance
• Motor Insurance
• Personal Liability Insurance
• Burglary Insurance
• General Insurance Documentation
• General Insurance Underwriting
• General Insurance Claim
3. Introduction
A very broad classification of insurance is life and non-life (general
insurance).
General Insurance comprises of:
• Insurance of property against fire, theft etc.
• Personal Insurance such as Accident & Health Insurance.
• Liability Insurance which covers legal liability arising out of third party
claims such as claim from a person injured in a motor accident etc.
• Other types of Insurances such as Credit Insurance, Crop Insurance, etc.
Thus General Insurance provides indemnity against loss arising from
damage to property or assets, expenditure or loss of earning arising from
injury to a person, legal liabilities etc.
4. The transactions of general insurance business in India are governed
by two main statues, namely:
• The Insurance Act, 1938
• General Insurance Business (Nationalisation) Act, 1972
The Insurance Act was passed in 1938 and was brought into force
from 1st July, 1939. This act applies to the GIC and the four
subsidiaries. The act was amended several times in the years 1950,
1968, 1988, 1999. This Act specifies the restrictions and limitations
applicable as specified by the Central Government under powers
conferred by section 35 of the General Insurance Business
(Nationalization) Act, 1972. The important provisions of the Act
relate to:
5. • Registration: Every insurer is required to obtain a Certificate of Registration from the
Controller of Insurance, by making the payment of requisite fees. Registration should be
renewed annually.
• Accounts and audit: An insurer is required to maintain separate accounts of the receipts and
payments in each class of insurance viz. Fire. Marine and Miscellaneous Insurance. Apart
from the regular financial statements, the companies are required to maintain the following
documents in respect of each class of insurance:
1. Record of Cover notes specifying the details of the risk covered, policies, premiums,
endorsements, Bank guarantees, claims
2. Register of employees
3. Cash Books
4. Reinsurance details
5. Claims register
6. • Investments: Investments of insurance company are usually made in
approved investments under the provisions of the Act. The guidelines and
limitations are issued by the Central Government from time to time.
• Limitation on management expenses: The Act prescribes the maximum
limits of expenses of management including commission that may be
incurred by an insurer. The percentages are prescribed in relation to the
total gross direct business written by the insurer in India.
• Prohibition of Rebates: The Act prohibits any person from offering any
rebate of commission or a rebate of premium to any person to take
insurance.
7. Types of General Insurance
1. Fire Insurance
2. Marine Insurance
3. Motor Vehicle Insurance
4. Health Insurance
5. Personal Accident Insurance
6. Burglary or Theft Insurance
8. 1. Fire Insurance: Fire insurance is a contract under which the insurer in
return for a consideration (premium) agrees to indemnify the
insured/assured for the financial loss which the Insured may suffer due to
destruction of or damage to property or goods, caused by fire, during a
specified period. Thus the basic ingredients of Fire Insurance are as
follows:
• i. The financial loss should be on account fire resulting in damage or
destruction of property or goods.
• ii. The maximum amount which the Insured can claim as compensation in
the event of loss is agreed to between the parties at the time of entering
into the contract.
9. 2. Marine Insurance: Marine Insurance is an Insurance against loss or
damage or destruction of Cargo, freight, merchandise or means or
instruments of transportation whether by sea, land or air. Thus marine
insurance provides indemnity for loss or damage to ship, cargo or mode of
transport by which the property is taken, acquired or held between the
point of Origin and point of destination.
10. 3. Motor Vehicle Insurance: It is a contract of Insurance under which the
Insurer indemnifies the Insured, who is the owner or an operator of a
Motor Vehicle, against any loss that he may incur due to damage to the
property (i.e. the Motor Vehicle) or any other person (i.e. Third Party) as a
result of an accident. There are two types of Motor Vehicle Insurance:
• a. Mandatory: In India it is mandatory ie required by Law, for every
owner or operator of a Motor Vehicle to take insurance that provides for
payment of compensation to a Third Party who dies or suffers injuries
due an accident caused by the said motor vehicle.
• b. Comprehensive: Under a comprehensive motor insurance policy apart
from the coverage of Third Party Liability (as provided in the mandatory
policy) various other risks are also covered. These include damage to the
Motor Vehicle caused by fire, accident, theft etc.
11. 4. Health Insurance Policy: The Health Insurance or Medi Claim Policies
are those policies which cover hospitalization expenses for the treatment
of illness/ injury as per the terms and conditions of the policy.
• These policies may also cover pre hospitalization expenses prior to
hospitalization and also post hospitalization expenses for the period
specified in the policy.
• Some of the Insurers also cover the following expenses in this policy:
a. Ambulance Charges
b. Day Care treatment charges i.e. treatment by using advanced
technologies when even 24 hours of hospitalization is not required.
12. 5. Personal Accident Insurance: The purpose of personal insurance is to
provide for payment of a fixed compensation for death or disablement
resulting from injury to the body of a human being caused due to an
accident.
6. Burglary or Theft Insurance: Theft Insurance Contract covers losses
from burglary, robbery and other forms of theft. Theft generally refers to
the act of stealing. Burglary is defined to mean the unlawful taking of the
property within the premises that have been closed and in which there are
visible marks evidencing forceful entry.
13. Principles of General Insurance
1. Nature of Contract
2. Principle of Utmost Good Faith
3. Principle of Insurable Interest
4. Principles of Indemnity
5. Principle of Subrogation
6. Principle of Contribution
7. Principle of Proximity Clause
14. 1. Nature of Contract:
Nature of contract is a fundamental principle of insurance
contract. An insurance contract comes into existence when
one party makes an offer or proposal of the contract and
the other party accepts the proposal. The contract should
be simple to be understood by each party. The person
entering into the contract should enter with his/her free
consent.
15. 2. Utmost Good faith:
In an Insurance contract utmost good faith means that ‘each party
to the proposed contract is legally obliged to disclose to the other all
information which can influence the others decision to enter the
contract. In case it is found that full and true disclosures were not
made at the time of the contract the effected party will have the
right to regard the contract as void. From the above we can arrive at
the following conclusion:
• Each party is required to tell the other the truth and the whole
truth and nothing but truth.
• Failure to reveal information even if not asked for gives the
aggrieved party the right to regard the contract void.
16. 3. Insurable Interest: Thus insurable interest means that the Insured
must stand to suffer a direct financial loss if the event against which the
insurance policy is taken does actually occur. The insurable interest is
generally established by ownership, possession or direct
relationship. There are four essential components of Insurable interest:
• There must be some property, right, interest, life, limb or potential
liability which is capable of being insured.
• Any of the above i.e. property, right, interest etc must be subject matter
of insurance.
• The insured must have a formal or legal relationship with the matter
which is the subject of insurance.
• The relationship between the insured and the subject matter of
insurance must be recognized by law.
17. 4. Indemnity:
Under the principle of indemnity the insured should be compensated
only for the loss that has been incurred by him as a result of the event
in respect of which the insurance has been taken. It will not be in
order if the Insured should make any profit out of such event (such as
fire, motor accident etc.)
In certain cases the amount of compensation given by the Insurer may
be less than the actual loss that has been incurred. However under no
circumstances the compensation to the Insured should be more than
the loss that has been incurred
18. 5. Subrogation:
Subrogation may be defined as ‘transfer of legal right of the Insured to
recover to the Insured’. In case the insured, after having received
compensation for loss (i.e.indemnity) from the Insurer also receives
from another person any amount towards such loss then he will be
placed in a position of gain which is against the Principle of Indemnity.
Hence the Insurer will have the right to recover the indemnity or the
compensation paid to the Insured to the extent the same has been
received by the Insured.
The Insurer can only claim the amount of compensation paid by it to
the Insured and nothing over and above that.
19. 6. Principle of Contribution:
An individual may have more than one policy for the same in
respect in of the same property and in case of a loss if the Insured is
able claim compensation for the said loss from all Insurers it is but
obvious that he would be making a profit from this loss. This is
against the Principal of Indemnity. This situation is taken care of by
the Principle of Contribution. Contribution may be defined as the
right of the Insurer who has for a loss to recover a proportionate
amount from other insurers who are also liable for the same loss.
20. The condition of contribution will arise if the following conditions are
met:
• Two or more policies should exist.
• The policies must cover a common interest.
• The policy must cover the same cause or event which results into a loss.
• The policies must cover a common subject matter i.e. the same
property.
• All the policies must be in operation at the time of loss.
It may be noted here that it is not essential that the policies should be
identical to each other.
21. 7. Principle of Proximity Clause:
The loss to a property can be caused by more than one cause.
Under this principle in such a situation the nearest or the closest or
the most proximate cause shall be taken into consideration to
decide the liability of the insurer.
Example: A cargo ship’s base was punctured due to rats. This
resulted in the sea water entering the ship and accordingly the
cargo was damaged. Here there are two causes for the damage of
the cargo ship:
• The Cargo ship getting punctured because of rats.
• The sea water entering the ship through the punctures.
In this case the nearest cause of damage is the sea water which is
insured, the insurer must pay the compensation.
22. FIRE INSURANCE
Fire insurance is a contract under which the insurer in return for a consideration
(premium) agrees to indemnify the insured/assured for the financial loss which the
Insured may suffer due to destruction of or damage to property or goods, caused
by fire, during a specified period. Thus the basic ingredients of Fire Insurance are as
follows:
• The financial loss should be on account of fire resulting in damage or destruction
of property or goods.
• The maximum amount which the Insured can claim as compensation in the event
of loss is agreed to between the parties at the time of entering into the contract.
It should be understood here that the event that results into financial loss would be
fire and not accident. Secondly the financial loss resulting from damage to a
property may be much more than the sum assured. In such case the Insurer would
be liable to make payment of the sum assured only.
23. Features of Fire Insurance
(1) Offer & Acceptance:
(2) Payment of Premium:
(3) Contract of Indemnity:
(4) Utmost Good Faith:
(5) Insurable Interest:
(6) Contribution:
(7) Period of fire Insurance:
(8) Deliberate Act:
24. Procedures for taking Fire insurance Policy
A. Selection of Company: fire insurance company with which the
insurance is to be effected must be identified.
B. Proposal Form: The proposal Form would require the following
details to be filled up: Name and Address of the Proposer, Nature of
Business, Details of Asset to be Insured, Type of Fire Insurance
Policy, Current Market Value of the Asset and Amount for which the
Insurance is to be taken.
C. Evidence of Credibility (Authority) : The Insurance Company may
check the credentials of the proposer to establish his credibility and
ensure that he has not been involved in any unscrupulous activity.
25. D. Survey of the Property: The Surveyors are to inspect the property
carefully and to estimate the degree of risk involved. It is on this basis of
this report of the Surveyors that the Insurance Company accepts or
rejects the proposal and quotes the rate of premium.
E. Acceptance of Proposal Form: On the basis of the proposal and the
report of the Surveyor the Insurance Company would accept or reject the
proposal.
F. Commencement of Risk: The next step is to pay premium. Once the
premium is paid the coverage of risk would commence.
G. Cover Note: The Insurance Company may accept risk unconditionally
or subject to certain conditions and may give provisional protection to
the Insured by a document known as Cover Note.
H. Policy: The final step is to issue the Fire Insurance Policy.
26. Types of Fire Insurance Policy
1. Specific policy: A specific policy is a policy which insures the risk for a
fixed amount. Under this Policy the Insurer will pay the actual loss or
the Insured amount whichever is less.
2. Valued Policy: In such a policy a fixed amount is paid as
compensation irrespective of the loss. This type of policy violates the
principle of Indemnity and can be legally challenged, at the time of loss
the market value of the property is not taken into consideration.
3. Average Policy: A fire policy containing an average clause is called
Average Policy. An average policy requires the insurer to pay that
proportion of actual loss as the Insurance bears to the actual value of
the property at the time of loss.
27. 4. Floating Policy (Floater Policy): This policy covers loss by fire caused
to property belonging to the same person but located at different
places under a single sum and for one premium.
5. Comprehensive policy: This is also known as 'all in one' policy and
covers risks like fire, theft, burglary, third party risks, etc. It may also
cover loss of profits during the period the business remains closed due
to fire.
6. Replacement or Re-instatement policy: In this policy the insurer
inserts a re-instatement clause, whereby he undertakes to pay the cost
of replacement of the property damaged or destroyed by fire. Thus, he
may re-instate or replace the property instead of paying cash.
28. Fire Hazard
The consideration of hazard is important when an insurance company is
deciding whether or not it should insure some risk and what premium to
charge.
So a hazard is a condition that creates or increases the chance of loss.
Therefore a hazard is a condition that increases the chances of loss. Thus, if a
person owns an older building with defective wiring, the defective wiring is a
physical hazard that increases the chance of a fire. Following are the hazards
in the fire insurance:
• Nature of the construction material:
• The lighting and the heating system in the premises:
• Smoking cigarette in the premises:
• Nature of business occupation:
• Nature of the adjoining premises:
29. MOTOR INSURANCE
• Motor insurance policy is a contract between the insured and the
insurer in which the insurer promises to indemnify the financial
liability in event of loss to the insured.
• Motor Vehicles Act in 1939 was passed to mainly safeguard the
interests of pedestrians. According to Section 24 of Motor Vehicles
Act, “No person shall use or allow any other person to use a motor
vehicle in a public place, unless the vehicle is covered by a policy of
Insurance.”
• The risks under motor insurance are of two types:
(1) Legal liability due to bodily injury, death or damage caused to the
property of others.
(2) Loss or damage to one’s own vehicle injury to or death of self and
other occupants of the vehicle.
30. Classification of Motor Vehicles
I. Private cars:
(a) Private Cars - vehicles used only for social, domestic and pleasure
purposes
(b) Private vehicles - Two wheeled
1. Motorcycle/Scooters
2. Auto cycles
3. Mechanically assisted pedal cycles
II. Commercial vehicles
(1) Goods carrying vehicles
(2) Passengers carrying vehicles
(3) Miscellaneous & Special types of vehicles
31. Basic principles of Motor insurance
Motor insurance being a contract has to fulfill the requirements of a valid contract
as laid down in the Indian Contract Act 1872. In addition it has certain special
features common to other insurance contracts. They are:
• Utmost good faith: The principle of Utmost good faith casts an obligation on the
insured to disclose all the material tracts. E.g. the driving history, physical health
of the driver, type of vehicle etc.
• Insurable Interest: In a valid insurance contract it is necessary on the part of the
insured to have an insurable interest in the subject matter of insurance.
• Indemnity: It aims at keeping the insured in the same position he was before the
loss occurred and thus prevent him from making profit from insurance policy.
• Subrogation and Contribution: Subrogation refers to transfer of insured's right of
action against a third party who caused the loss to the insurer. Subrogation comes
in the picture only in case of damage or loss due to a third party.
32. Types of Motor Insurance Policy
The All India Motor Tariff governs motor insurance business in India. According to
the Tariff all classes of vehicles can use two types of policy forms. They are form A
and form B. Form A which is known as Act Policy is a compulsory requirement of
the motor vehicle act. Use without such insurance is a penal offence. Form B which
is also known as Comprehensive Policy is an optional cover.
1. Liability only policy – This covers third party liability and/or death and property
damage. Compulsory personal accident covers for the owner in respect of owner
driven vehicles is also included.
2. Package policy – This covers loss or damage to the vehicle insured in addition to
1 above.
3. Comprehensive policy- Apart from the above-mentioned coverage, it is
permissible to cover private cars against the risk of fine and/or theft and third
party/ theft risks.
33. Motor Insurance Claim Settlement
Claim arise when
(1) The insured’s vehicle is damaged or any loss incurred.
(2) Any legal liability is incurred for death of or bodily injury
(3) Or damage to the third party‘s property.
The claim settlement in India is done by opting for any of the following
by the insurance company
(a) Replacement or reinstatement of vehicle
(b) Payment of repair charges
34. Motor insurance claims are settled in three stages
• In the first stage the insured will inform the insurer about loss. The
loss is registered in claim register
• In the second stage, the automobile surveyor will assess the causes of
loss and extent of loss. He will submit the claim report showing the
cost of repairs and replacement charges etc.
• In the third stage, the claim is examined based on the report
submitted by the surveyor and his recommendations.
36. 1. HEALTH INSURANCE
“Health insurance is an insurance, which covers the financial loss arising out
of poor health condition or due to permanent disability, which results in loss
of income.”
A health insurance policy is a contract between an insurer and an individual
or group, in which the insurer agrees to provide specified health insurance at
an agreed upon price (premium). It usually provides either direct payment or
reimbursement for expenses associated with illness and injuries.
The reasons for rise in health care costs are:
(a) Increase in medical treatment costs.
(b) Technological advancements in medical equipment.
(c) High labour costs.
37. The health insurance policies available in India are:
(a) Mediclaim policy (individuals and groups)
(b) Overseas Mediclaim policy
(c) Raj Rajeshwari Mahila Kalyan Yojna
(d) Bhagyashree Child Welfare Policy
(e) Cancer Insurance Policy
(f) Jan Arogya Bima Policy
38. a.) Mediclaim Policy (individuals and groups): Mediclaim policy is offered to
individuals and groups. It covers the hospitalization for diseases or sickness and
for injuries. The medical expenses will be reimbursed only if the insured is
admitted in the hospital for a minimum duration of 24 hours. Cost of treatment
includes consultation fee of doctors, cost of medicines and hospitalization
charges.
b.) Overseas Mediclaim Policy: In 1984, the Overseas Mediclaim Policy was
developed. This policy will reimburse the medical expenses incurred by Indians
upto 70 years of age while traveling abroad. The premium will be charged based
on their age, purpose of travel, duration and plan selected by the insured under
the policy. This policy is provided is provided to businessmen, people going on
holiday tour, traveling for educational professional and official purposes.
39. c.) Raj Rajeshwari Mahila Kalyan Yojna: It is offered to women residing in
rural and urban areas. Women between 10-75 years of age are eligible for
this policy irrespective of their occupation and income level.
d.) Bhagyashree Child Welfare Policy: It is offered to girls between 0-18
years. The age of the parents of the girls shouldn’t be more than 60 years. It
provides coverage to one girl child in a family who loses her father or mother
in an accident.
e.) Cancer Insurance Policy: It is designed for cancer patient’s aid association
members. The insured will pay premium to their association along with the
membership fee.
f.) Jan Arogya Bima Policy: This policy provides medical insurance to poorer
section of the people. This policy covers illness like heart attack, jaundice,
food poisoning, and accidents etc. that requires immediate hospitalization.
40. 2. PERSONAL ACCIDENT INSURANCE: Personal Accident is an insurance cover wherein, in the event
of the person sustaining bodily injuries resulting solely and directly from an accident caused by
EXTERNAL, VIOLENT & VISIBLE means , resulting into death or disablement. Personal Accident
insurance covers but not limited to an accident may include events like:
• Rail/Road/Air Accident.
• Injury due to any collision/fall.
• Injury due to Bursting of gas cylinder.
• Snake-bite, Frost bite/Dog bite.
• Burn Injury, Drowning, Poisoning etc.
This Policy is available to persons between the age of 5 and 70 years (Male & Female).
Factors affecting Sum Insured under Personal Accident Insurance
(a) Income from gainful employment,(b) Type of occupation,(c) Age as on date of proposal,(d)
Period of insurance (e) Conditions prevailing at the place from where the proposal is made etc.
41. 3. TRAVEL INSURANCE:
Travel insurance coverage is usually limited to the period of your travel. However,
some insurance companies may offer various combinations of protection to cater
to the specific needs of customers, including long-term annual policies for a
frequent traveler. Travel insurance can be purchased for you and/or your family to
insure against travel-related accidents, losses or interruptions, such as:
(a) Personal accident and Medical-related expenses
(b) Loss of travel or accommodation expenses due to cancellation or curtailment
of the journey
(c) Losing your passport
(d) Personal liability
(e) Delayed baggage and ravel delay
(f) Hijacking
42. 4. MICRO INSURANCE: Micro insurance is the protection of low -
income people against specific perils in exchange for regular premium
payments proportionate to the likelihood and cost of the risk involved.
In India, it is often assumed that a micro insurance policy is simply a
low -premium insurance policy. Low-income clients often:
(a) Live in remote rural areas, requiring a different distribution channel
(b) Are often illiterate and unfamiliar with the concept of insurance,
requiring new approaches to both marketing and contracting
(c) Tend to face more risks than wealthier people do because they
cannot afford the same defenses
(d) Have little experience of dealing with formal financial institutions;
43. BURGLARY INSURANCE
For the business house Burglary insurance is as essential as Fire insurance, as
it enables them to recoup the losses suffered by them consequent on
burglary or house breaking. In addition to the burglary policy, other types of
policies giving wider covers have also been devised by the burglary
department.
• Burglary: The criminal law of the country does not speak of an offence
called burglary. Hence it becomes necessary for the insurers to lay down in
the policy the definition of the term. As normally understood burglary is:
(a) Theft of property from the premises following upon felonious entry of the
said premises by violent and forcible means.
(b) Theft by a person in the premises who subsequently breaks out by violent
and forcible means provided there shall be visible marks made upon the
premises at the place of such entry or exit by tools, explosives, electricity or
chemicals. Use of force may be against property and person.
44. • Theft: Indian Penal Code in Section 378 defines theft as follows: "whoever
intending to take is honestly any movable property out of the possession of
any person without the consent of that person or of any person having for
that purpose authority, moves that property in order to such taking is said
to commit theft."
• House-breaking: The word in practice is equal to 'Burglary'. Section 445 of
the Indian Penal Code has laid down a definition of the term. A person is
said to commit housebreaking who commits house trespass if he effects his
entrance into the house (or any part of it), or if being in the house (or any
part of it) for the purpose of committing an offence, or having committed
an offence therein he quits the house, such entrance or exit being made by
use of force in one of the six ways as described in the Indian Penal Code.
45. The main types of policies are as follows:
(i) Business Premises Policy,
(ii) Jewellary and Valuable Policy,
(iii) All Risk Policy, and
(iv) Fidelity Insurance
46. i.) Business Premises Insurance Policies: Policies issued to business
premises cover stock-in-trade, goods in trust or on commission, fixtures
and fittings, tools of trade and other similar property and cash and
currency notes in locked safe against the risk of burglary and house-
breaking. In regard to stock-in-trade and other goods the policy may
be issued on full value basis or on "first loss" basis ('Policy insures the
property up to a specified amount only )
47. i.) Business Premises Insurance Policies: Policies issued to business
premises cover stock-in-trade, goods in trust or on commission, fixtures
and fittings, tools of trade and other similar property and cash and
currency notes in locked safe against the risk of burglary and house-
breaking. In regard to stock-in-trade and other goods the policy may
be issued on full value basis or on "first loss" basis ('Policy insures the
property up to a specified amount only )
ii.) Cash-in-Safe Insurance: The cover includes only when the cash is
secured in a safe and is granted only if the safe is burglar proof and is of
an approved make and design. Safe which is permanently installed in
the premises is a better risk than a safe which can be shifted.
48. iii.) All Risks (Jewellery and Valuables) Insurance: Policies under this form of
insurance cover risks in respect of jewellery, plate, watches, personal
ornaments and other valuables. Loss or damage by any accident or
misfortune including fire, theft, robbery from the person, defective settings
or fastening and accidental damage are thus covered. The policies do not,
however, cover loss or damage:
• Occasioned by or in consequence of war, revolution, riot, earth-quake or
other convulsions of nature etc.
• Caused by or arising from any process of repairing, restoring or renovating
any property insured;
• Due to moth, wilder, wear or other deterioration or inherent defect in any
property insured.
49. iv.) Fidelity Insurance: Fidelity insurance protects organizations from loss of
money, securities, or inventory resulting from crime. Common Fidelity claims
allege employee dishonesty, embezzlement, forgery, robbery, safe burglary,
computer fraud, wire transfer fraud, counterfeiting, and other criminal acts.
Liabilities covered by crime insurance usually fall into two categories,
although many polices combine both types of coverage:
• Money and security coverage pays for money and securities taken by
burglary, robbery, theft, disappearance and destruction.
• Employee dishonesty coverage pays for losses caused by most dishonest
acts of your employees, such as embezzlement and theft
50. General Insurance Policy Structure or Key Elements
• Heading – The name of the insurer and other particulars regarding
the issuing office- the name of the policy etc.
• Preamble – This contains relevant information regarding the subject
matter of insurance, the locations, identity, value, and period of
insurance required etc.
• Signature – The signature of an authorized official empower to accept
the offer of the proposer and issue a policy.
• Operative or insuring clause - States the peril(s) which are to be
insured against.
• Exclusions – States the various conditions under which the policy will
not pay.
52. 1. Proposals: It is also said that a proposal is the basis of insurance. In
other words, the facts mentioned in the proposal form becomes the
basis for the insurance policy cover. It contains all the relevant
information about-
• Generic details about the insured/proposer – name, address etc.
• Specific details about the subject matter to be insured-it contains
details about projects which are to be insured-eg.hydro electric
project, oil rigging platform etc.
• Details regarding the value to be sum insured; duration of insurance
covered required.
53. 2. Policy Schedule: The policy schedule is the document which together with
various clauses, warranties and conditions forms the contract. Naturally, this would
include such details as name address, nature of business, policy number etc. Other
more particular information detailed in the policy schedule would be
• Full details and description of the subject matter to be insured.
• Sum insured based on value of the sum insured. The basis of valuation and the
adequacy of the sum insured is to be measured and specified clearly to avoid
dispute in future in the event of a claim.
• Period of insurance.
• Premium
• The terms and conditions which details the actual cover
• The various clauses which attach to the policy schedule.
54. 3. Certificates of insurance: These are usually given in marine transit
insurance under open policies and also for motor insurance. In motor
insurance they are mandatory as it confirms that there is insurance cover
existing for the vehicle plying on public roads. They are less detailed than
a policy and not stamped, but essentially give the same information
regarding insurance
4. Cover note: These are documents that are issued immediately to
prove that insurance cover is existing and valid for 60 days from the date
of issue. Mostly used in motor insurance and transit insurance,
particularly for import covers by sea. The cover note in marine insurance
would be valid for duration of transit. The cover note is valid for a
maximum period of 60 days.
55. 5. Endorsements: There may be instances, when during the policy, certain
changes may be advised by the customer. Eg. Change in location, correction
of name or other details of subject matter insured. There may be instances
of increase in the value to be insured, inclusion of extra covers or deletion of
covers etc. In such cases, the insurer would, on being so solicited by the
insured customer, issue an endorsement which would reflect the changes
and form part of the policy document. Generally endorsements are issued
for such alterations as
• Change in insurable interest and Value at Risk
• Cancellation of insurance
• Change in the location or situation of risk
• Reduction or addition to the risk
• Change of the insured as when a transfer of interest etc.
56. • Renewal Notice: While it is not obligatory to issue renewal notices
reminding insured that the policy is due for renewal, it is
recommendatory as an excellent customer service initiative.
• Warranties: Warranties are an extension of the terms and conditions
contained in the clauses which attach to the policy schedule.
Warranty is a statement by which the insured undertakes to do/not
do a particular thing or fulfil a condition, or whereby he affirms or
negates the existence of a particular state of facts which affect the
incidence of a claim. Warranties can either relate to facts existing at
the time of the contract or relate to the future.
57. General Insurance Underwriting Process
Underwriting is defined as assumption of liability. The underwriting process
follows a series of stages, at the end of which the status of a risk is decided.
It is only after the risk has been weighed and all possible alternatives
evaluated that the final underwriting is done. When a proposal for insurance
is received, the underwriter has four possible courses of action:
• Accept the risk at standard rates, Charge extra premium depending on the
risk factor, Impose special conditions and Reject the risk.
There are different types of hazard which can influence his decision to accept
or reject a risk ─
1. Physical hazards
2. Moral hazards
3. Financial hazards
4. Morale hazard
58. The underwriter can accept a proposal, reject it or accept it with
certain modifications. Some of the modifications that can be made are:
• Hazard incidence can be reduced: For loss prevention and
minimization, underwriters can recommend certain changes that will
safeguard against physical hazards.
• Changing rating plans and policy terms: Sometimes a proposal that
seems unacceptable at one rate may become a desirable business
under another rating plan or with Special Conditions such as
‘compulsory excess’.
59. General Procedure for Claim Settlement
1. Intimation/Submission of the Claim by the Insured: The insured
would intimate the insurance company of the occurrence of a peril
or risk which has caused loss of or damage.
2. Evaluation/Registration of Claim: The insurer would briefly initiate
process check –
(i) Whether the policy has been issued by the insurer
(ii) Whether the policy is in existence
(iii) Whether correct premium has been received by the insurer
(iv) Whether the peril causing loss/damage is an insured peril
60. 3. Appointment of surveyor/loss assessor/investigator etc: The
insurer would immediately arrange for surveyor to be appointed who
would look into the circumstances of the loss, assess the actual loss
suffered in money terms and advise the insurer.
4. Settlement of claims: The insurer would ensure claims are settled on
the receipt of the final report from the surveyor, generally within the
TAT (Turn around time) stipulated by various regulations and
committed by the insurance company.
5. Recovery: The next step for the insurance company, in certain cases
is initiating process for recovery from the third person– (eg in marine
cargo transit claims & motor third party liability claims)
61. Settlement of Claims
(a) Repair & replacement: The insurer has the option of repairing
and/or replacing the damaged or destroyed property. Only conditions
would be that the cost of repair/replacement will not exceed the sum
insured.
(b) Replacement: In Total loss, the subject matter is totally destroyed
and the insurer, subject to applicable terms and conditions agrees to
replace the same. Constructive Total Loss cost of recovery and/or
salvage would be more than the cost of the goods itself.
(c) Repair: The compensation by the insurer would be in the form of
cost of repairs to the subject matter damaged by the insured peril,
subject to the maximum level of indemnity (sum insured) under the
policy.
(d) Reinstatement: Reinstatement of the insured to the position he was
in prior to the loss occurrence. Here new items are replaced in place of
damaged ones even if the original items were not new.