Pdf, Docx, Wps, Rtf

Fundamental Principles of Insurance

FUNDAMENTALS and PRINCIPLES OF INSURANCE

Life Insurance covers insurance of human beings.

General Insurance comprises of

a. Insurance

 of

 property

 against

 fire,

 burglary

 etc,

b. Personal

 insurance

 such

 as

 Accident

 and

 Health

 Insurance,

 and

c. Liability

 insurance

 that

 covers

 legal

 liabilities

 etc.

In case any of these principles are missing the insurance contract will become

void.

Student Notes

PRINCIPLES OF UTMOST GOOD FAITH

To consider a ‘Life Insurance’ proposal the insurer needs to

know

•

•

•

•

Personal

 details

 of

 the

 proposer

Personal

 Health

 details

 of

 the

 proposer

Family

 Health

 particulars

 of

 the

 proposer

Previous

 Insurance

 details

 of

 the

 proposer

 etc.

To consider ‘General Insurance’ proposal the insurer needs to

know

a) Details

 of

 the

 property

 to

 be

 insured.

b) Previous

 details

 of

 the

 property

 /

 accidents

 etc.

The insurer is entirely dependent upon the proposer for the

above details.

The proposer on the other hand knows or is supposed to know

everything about the above details.

Fundamental Principles of Insurance

CSC – VLE Training

Utmost Good faith - Contd

Hence there is a need for Utmost Good Faith on the part of the proposer.

Both the insurer and the client should ensure that

a) Client

 discloses

 all

 correct

 and

 complete

 information

 in

 the

proposer

 to

 the

 insurer

i. Insurer

 does

 not

 withhold

 any

 information

 from

 the

 client

such

 as

 Standard

 features

 of

 the

 policy

ii. Premiums

 /

 Discounts

 as

 per

 standard

 policy...