Business Law - Insurance

Indemnify

make secure against loss; compensate for los

Life Insurance

A form of insurance on the life of a person. If the person dies then the insurance policy pays out a sum of money to the policyholder (such as a person's family).

Coinsurance

A type of insurance in which the insured pays a share of the payment made against a claim.

List the common types of insurance and their purpose.

Home- to protect your house from damage Auto- to protect your car from damage, Marine - covers the loss or damage of ship, cargo or terminals, Fire- covers damage caused by fire, casualty - covers individual acts of negligence, Fidelity- compensating for losses of dishonesty and disloyalty inland marine- covers your property that is in motion

What is the purpose of life insurance?

Life insurance provides the diseased family with the money to get along after their death.

What risks are covered by automobile insurance?

Losses arising from or connected to the ownership and operation of a motor vehicle.

What are the types of social insurance?

Medicare, Social security, Unemployment insurance,

Liability Insurance

Provides protection against claims of parties who suffer injury or other loss as a result of negligence.

Automobile Insurance

Provides protection for losses arising from or connected to the ownership and operation of motor vehicles.

What are some Common Clauses and Exclusions in life insurance contracts?

Suicide clause, dangerous activity, aviation exclusion, drug or substance abuse.

What is the purpose of social insurance?

To help those that can no longer provide for themselves, or can not provide for themselves due to poor circumstances.

Describe the various types of property and casualty insurances.

Types of property insurance include fire insurance, marine insurance, and inland marine insurance, which protect property from the perils of wherever they have been placed. Types of casualty insurance include theft insurance, automobile insurance, liability insurance, and health insurance, which protect stolen property, damage to cars, suffering injuries due to the negligence of another, and losing income due to sickness or injury, respectively.

Insurable

interest exists when an insured person derives a financial or other kind of benefit from the continuous existence, without impairment or damage, of the insured object.

Endorsements

A clause in an insurance policy detailing an exemption from or change in coverage.

Insurance

A contract whereby one party (insurer) agrees to indemnify or guarantee another party (insured) against a loss by a specified future contingency or peril in return for payment of a premium.

Exclusions

An item or risk specifically not covered by an insurance policy.

Describe exclusions and endorsements and their purposes.

Exclusions are something not covered by an insurance policy, so the insured doesn't have to cover everything if they wish. Endorsements are clauses that show an exemption from coverage, and can stop certain things from being covered by a policy.

When is an insurable interest person present?

For property and casualty insurance.

What is the reason most people purchase insurance?

If an accident did occur that they would be able to pay the accident without being bankrupt.

Comprehensive Insurance

Indemnifies against all damage to the insured's car except that caused by collision or upset.

No-fault Insurance

Insurance contract under which insureds are indemnified for losses by their own insurance company, regardless of fault in the incident generating losses.

Explain what insurance is

It is protection for if a accident happens that the company will pay for your cost.

Fire Insurance

Property insurance that covers the direct loss of property resulting from fire, lighting strikes, or removal from premises endangered by fire.

Collision Insurance

Protects against direct and accidental damage due to colliding with another object and upset.

Casualty Insurance

Provides financial reimbursement to a person or company in the event of various situations. This includes theft insurance, car insurance, liability insurance, and health insurance.

Property Insurance

Provides financial reimbursement to the owner of a property and its contents in the event of damage or theft.

In the case of fire insurance, what three steps must be taken to prove that a particular loss should be indemnified?

The insured must show that there was an actual fire, the fire had to have been hostile, and the hostile fire has to have been the cause of the loss.

Define the three main types of life insurance?

Whole Life - Covers 100 years Term - Covers terms that can last 1, 5, or 10 years. Endowment - Insurer pays beneficiary the policy's face amount if they die within the period of coverage, which usually lasts 20 years. If they live, the owner of the policy is paid the face value.

Policy

a course or principle of action adopted or proposed by a government, party, business, or individual.

insurer

a person or company that underwrites an insurance risk; the party in an insurance contract undertaking to pay compensation.

Beneficiary

a person who derives advantage from something, especially a trust, will, or life insurance policy.

Risk

a situation involving exposure to danger

Premium

an amount to be paid for an insurance policy

Insured

covered by insurance

Face Value

value the value printed or depicted on a coin, banknote, postage stamp, ticket, etc., especially when less than the actual or intrinsic value.