Insurance Questions and Answers

Utmost good faith is a common law principle (sometimes called Uberrimae Fidei). The principle means that every person who enters into a contract of insurance has a legal obligation to act with utmost good faith (honesty) towards the company offering the insurance.

Life insurance provides an infusion of cash for dealing with the adverse financial consequences of the insured's death. Life insurance enjoys favorable tax treatment unlike any other financial instrument. Death benefits are generally income-tax-free to the beneficiary.

The purpose of life insurance is to provide financial protection to surviving dependents after the death of an insured.

Ex gratia (/ˌɛks ˈɡreɪʃiə/; also spelled ex-gratia) is Latin for "by favour", and is most often used in a legal context. When something has been done ex gratia, it has been done voluntarily, out of kindness or grace.

public liability insurance: Insurance that covers the insured in the case of legal action brought by members of the public. Public Liability insurance is designed to protect the insured against negligence for accidental loss of or damage to third party property, bodily injury etc

The minimum amount of auto insurance in Nigeria that motorists must carry is third party motor insurance. Know the Terminology In the auto insurance world, a third party is defined as everyone involved in an accident except the policy holder.

average clause. is an insurance policy that restricts the amount payable to a sum not to exceed the value of the property destroyed and that bears the same proportion to the loss as the face of the policy does to the value of the property insured.

The purpose of an endorsement is a policy change. Insurance companies create endorsements to offer options to insureds to add coverage or increase coverage limits, but insurers may also issue special endorsements to limit or restrict coverage. Insurance endorsements are used in property and casualty insurance.

Contract Subject matter of insurance is the life, limbs, property, rights or any potential legal liability insured under a policy.Subject matter of contract is the insured's financial interest in the subject matter of insurance.

Insurable interest is an essential requirement for issuing an insurance policy which makes the entity or event legal, valid and protected against intentionally harmful acts. People not subject to financial loss do not have an insurable interest.

Loading the player... A risk premium is the return in excess of the risk-free rate of return an investment is expected to yield; an asset's risk premium is a form of compensation for investors who tolerate the extra risk, compared to that of a risk-free asset, in a given investment.

A level premium is a type of insurance premium that is regularly associated with term life insurance. The term level premium basically means that you are going to have the same premium payment for the entire life of the policy.

The pure premium "refers to that portion of that rate needed to pay losses and loss-adjustment expenses".

natural premium. : the amount required to meet the mortality cost of life insurance for each particular year and increasing from year to year for any given unit of protection.