It is also to be mentioned that through insurance one wants to protect him/ her against asignificant monetary loss. Interest of people stays upon this are provided below:
Protecting family after one's death from loss of income
Ensuring debt repayment after death
Covering contingent liabilities
Protecting against the death of a key employee or person in business
Protecting business from business interruption and loss of income
Protecting against unforeseeable health expenses
Protecting own home against theft, fire, flood and other hazards
Protecting own car against theft or losses incurred because of accidents
Protecting in the event of disability; and so forth.
The Contract of Insurance
, known as the
, which determines theclaimswhichthe insurer is legally required to pay. In exchange for payment, known as
, theinsurer pays for damages to the insured which are caused by covered risks under the policylanguage.Insurance contracts are designed to meet specific needs and thus have many features notfound in many other types of contracts. The insurance policy is generally an integratedcontract, meaning that it includes all forms associated with the agreement between theinsured and insurer. The characteristics of a Contract of Insurance are enlisted below:
A contract of insurance must fulfil al the essential requirements of a contract as laid down inthe law of contract. Thus, there must be a proposal and an acceptance, the parties must becapable of contracting, the objective must not be illegal or immoral.
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