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The insurance transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate the insured in the event of a covered loss. but it must be reducible to financial terms.INTRODUCTION Insurance is a means of protection from financial loss. called the insurance policy. The amount of money charged by the insurer to the insured for the coverage set forth in the insurance policy is called the premium. It is a form of  risk management primarily used to hedge against the risk of a contingent. possession. which details the conditions and circumstances under which the insured will be financially compensated. and must involve something in which the insured has aninsurable interest established by ownership. or preexisting relationship. insurance company.  An entity which provides insurance is known as an insurer. If the insured experiences a loss which is potentially covered by the insurance policy. uncertain loss. or insurance carrier. he insured receives a  contract. the insured submits a claim to the insurer for processing by a claims adjuster. The loss may or may not be financial. A person or entity who buys insurance is known as an insured or policyholder.  .

. The insurance company reviews the claim for its validity and then pays out to the insured or requesting party (on behalf of the insured) once approve.MEANING  An insurance claim is a formal request to an insurance company asking for a payment based on the terms of the insurance policy.

or death in return for payment of a specified premium.DEFINITION  An arrangement by which a company or the state undertakes to provide a guarantee of compensation for specified loss. illness. . damage.

 Injury  Claims If you or someone else is injured. so settlements can take a long time to come since all medical treatment must be finalized first.  Homeowner's  Claims Like auto physical damage claims. whether in an auto accident or otherwise. including towing the wrecked vehicle away.SIX TYPES OF INSURANCE CLAIM  Auto  Physical Damage When your vehicle is damaged after an accident. and wait for the inspector to come to inspect your car. The injured person must typically submit medical reports to the insurer. you must report it to your insurer and answer questions about the loss. The insurer depreciates your damaged items according to their age and condition at the time of loss. You must answer several questions about the details of the accident. If you have a replacement cost endorsement. and sometimes give personal interviews to an adjuster. he will write you a check for the damages or begin the total loss process. submit receipts for your replaced items to your insurer and it will give you supplemental checks for the balance above what you had already received. call your insurance company and report the loss. Most homeowner's property claims are settled as actual cash value. . Once he determines whether your vehicle is repairable or a total loss. Injury claims are typically settled in a single lump sum. your insurer must inspect your damaged home or belongings before you receive a settlement check. at least at first.

you need the deceased person's policy information. Your insurance agent can help you through this process.  Life Insurance Claims  Unless you have an endorsement that provides some of the life insurance benefit prior to death. Health insurance contracts vary widely between companies and states. but the basic principle is that the insurer pays for medical charges according to your insurance contract. often. you will always file a life insurance claim for someone else. Report the loss immediately. The insurer will often provide the death benefit by placing the money in a trust account.  Commercial Claims  Commercial claims are often for large dollar amounts and involve many people. then the provider bills you for the balance. though other options are available. so these are among the only claims you don't have to file yourself. so you and the insurer can mitigate the loss and gain as much control as possible over the circumstances. Therefore. You are responsible for all charges your insurer does not cover. as well as proof of death and.  . The insurer will always investigate the circumstances of the claim before offering a settlement. and you must cooperate with these investigations while also managing your business after a loss. details about the cause of death.Health Insurance Claims  Health insurance claims are often submitted directly to the insurer by the medical provider. and providing you with a check book or debit card with which to draw the funds.

Motor vechicle act was passed in 1988 in this The courts can only grant compensation for the pecuniary and monetary loss caused and some other expenses. Cyclone Nilam in Chennai. their policy didn’t cover losses incurring due to “Act of God”. matrimonial claims. health claims. equity claims. there were many major natural disasters that rocked humanity across the globe.TYPE OF ACT Motor Vehicles Act:. Accident means any unintentional act. These disasters were Hurricane Sandy in New York. an act which is just by chance and without any premeditation. Flash flood in Uttarakashi. floods.In 2012. 1991. Typhoon Bopha in Philippines. Since. still there were few percentage of families with insurance coverage but didn’t get benefit. Not all of them were insured.     Act Of God:. but no court can even attempt to grant compensation for loss of life or limb. earthquakes. Act of God” means natural calamities such as tsunami.. This Act may be called the Public Liability Insurance Act. Public Liability Insurance Act 1991:- The following Act of Parliament received the assent of the President on the 22nd January. .  Before going further we should first understand the meaning of Accident..In today’s world we can see existence of different types of claims viz. and is hereby published for general information:An Act to provide for public liability. Accidental Claims means claim of right with respect to accident caused due to act of negligence of other. insurance claims etc. personal claims. Of all these claims we have one accidental claimswhich has increased in present time with the development of for the purpose of providing immediate relief to the persons affected by accident occurring while handling any hazardous substance and for matters connected therewith or incidental thereto. thunders or any other disaster caused due to the nature by Almighty (God). 1991. Due to these natural calamities many families lost lakhs and crores on their assets/property. Flood in Assam and earthquakes at several other places. Act of negligence have become actionable wrong.

For example. the insured must have interest in the subject matter of the insurance. The person entering into a contract should enter with his free consent. a creditor has an insurable interest in the life of a debtor.An insurable interest must exist at the time of the purchase of the insurance. Any fraud or misrepresentation of facts can result into cancellation of the contract. Absence of insurance makes the contract null and void. Under this principle of insurance. An insurance contract comes into existence when one party makes an offer or proposal of a contract and the other party accepts the proposal. If there is no insurable interest. an insurance company will not issue a policy. .PRINCIPLES OF INSURANCE  Nature of contract Nature of contract is a fundamental principle of insurance contract.  Principal of utmost good faith  Principle of Insurable interest Under this insurance contract both the parties should have faith over each other. As a client it is the duty of the insured to disclose all the facts to the insurance company.A contract should be simple to be a valid contract. A person is considered to have an unlimited interest in the life of their spouse etc.

It allows the insurer to pursue legal methods to recover the amount of loss. For example. .Principle of indemnity Principal of subrogation Indemnity means security or compensation against loss or damage. The principle of indemnity is such principle of insurance stating that an insured may not be compensated by the insurance company in an amount exceeding the insured’s economic loss. This principle is observed more strictly in property insurance than in life insurance. if you get injured in a road accident.The purpose of this principle is to set back the insured to the same financial position that existed before the loss or damage occurred. due to reckless driving of a third party. The principle of subrogation enables the insured to claim the amount from the third party responsible for the loss.In type of insurance the insured would be compensation with the amount equivalent to the actual loss and not the amount exceeding the loss.This is a regulatory principal. the insurance company will compensate your loss and will also sue the third party to recover the money paid as claim.

The insurance contract is a legal document that spells out the coverage. or car and/or against legal liability that may result from injury or damage to the property of others. . conditions and limitations of an insurance policy. sometimes called a fee-for-service plan.  · Property and casualty insurance is insurance that protects against property losses to your business.CONCLUSION  Insurance is a form is risk management in which the insured transfers the cost of potential loss to another entity in exchange for monetary compensation known as the premium. .  · An auto insurance policy typically covers you and your spouse. features. relatives who live in your home and other licensed drivers to whom you give permission to drive your car. · An indemnity plan. home. This type of insurance can protect a person or a business with an interest in the insured physical property against losses. is a type of insurance that reimburses you according to a schedule for medical expenses. regardless of who provides the service.