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What is meant by premium?
The money paid for insurance - to cover the risk
What is meant by risk managment?
Risk management is the process to identify, reduce the risk and then insure the remaining risk.
Three types of insurance a family might buy
Health insurance, Life Insurance, House Insurance
What does upmost good faith mean?
When applying for insurance the applicant must disclose all material facts.
What is meant by indemnity?
You cannot make a profit from an insurance claim
What is meant by compensation?
Payment made to an insured person who has suffered a loss.
Definition of insurance
Protection against financial loss caused by something that might happen.
What is meant by contribution?
If you insure an asset with a number of insurance companies, you will not receive compensation from each.
What is the equation for Average Clause?
Insured amount ÷ Actual value x Damage
What is meant by Average Claues?
This states that if something is insured for only a portion its value, the insurer is only liable for the same portion of the loss.
