Insurance

Question 1

What is insurance?

Answer 1

Insurance is financial protection that covers any loss that might happen e.g. burgalary

Question 2

What is a premium?

Answer 2

A premium is the fee paid by the insured to the insurance company to cover a particular risk

Question 3

What is compensation?

Answer 3

Compensation is the payment made to an insured person if they suffer a loss or injury

Question 4

What is utmost good faith?

Answer 4

Utmost good faith is when a person is obliged to answer all questions truthfully and disclose all relevant facts

Question 5

What is insurable interest?

Answer 5

Insurable interest is that you must gain by its existence and suffer from its loss

Question 6

What is indemnity?

Answer 6

Indemnity is that you cannot make a profit from a loss. The compensation is equal to the loss

Question 7

What is subrogation?

Answer 7

Subrogation is the right of the insurance company to seek compensation from the party that caused the damage

Question 8

What is contribution?

Answer 8

Contribution is if you insure an item with two insurance companies they will divide the compensation