Principles Of Insurance

• There are 7 principles of insurance and they are:

  Pooling of Risks

  Subrogation

  Proximate Cause

  Indemnity

  Good Faith

  Consideration

  Insurable Interest
• Proximity Cause - the direct and immediate cause of an event or action, as opposed to an indirect or delayed cause
• Pooling Of Risks - The sharing of risks among a group of people or organizations
• Subrogation - the right held by most insurance carriers to legally pursue a third party that caused an insurance loss to the insured
• Indemnity - Putting someone back into the position that they were in prior to the event that occurred
• Utmost Good Faith - Entering an agreement by disclosing all relevant information with absolute honesty and integrity.
• Contribution - Insurance taken out cannot be claimed over for the same event with multiple insurance companies
• Insurable Interest - Someone can only take out insurance when they have a personal stake in an even or loss
• What are the 2 types of insurance policies?

  Life insurance and Non - Life insurance
• What is the probability of something happening in a car crash called?

  Insurance
• What is the certainty of something happening in a life insurance called?

  Assurance
• A term policy pays out and if death occurs during the term of the policy such a policy is typically take out for a period of 1 - 30 years
• Whole life policies payout on death regardless of how long the insured lives
• An endowment policy pays out a lump sum after a specific term or on the death of the policy holder
• How many different types of Life Insurance policies are there?

  3
• There are 8 different types of Non - Life Insurance Policies