INSURANCE Flashcards
Purpose of Insurance
Seek to protect against occurrence of a particular misfortune or particular risk, crucial they are safeguarded in the event that perils or risk occurred.
Generally assumed
There is a claim and they will only pay if contractual need for payout.
Where does Insurance come from?
Marine Insurance
Stair briefly mentions it,
First Party Insurance
Insuring myself for losses I bear
Third Party Insurance
I insure my life/property for another’s benefit against losses they would bear
Indemnity Insurance
Insurance for the risk that a specified liability may arise
DTI v St Christopher Motorists Association
Need to know due to extra things attached to it
Life or Non-Life insurance
Difference is quality of uncertainty. Whole Life Policy - pays on your death
Endowment Policy - Pays you if you reach a given age
Defintion?
There is no definition as means people can’t try to get around it.
Scottish Amicable Heritable Securities Ltd v Northern Assurance Co
Insurer undertakes in consideration of the payment of an estimated equivalent beforehand to make up the assured any loss he may sustain by the occurrence of an uncertain contingency
Rough definition
Binding contract between 2 parties. One party is authorised to take the other’s risk concerning an uncertain event and promises to pay or provide something of value is it occurs.
The claiming party has an insurable interest in the subject matter of the insurance contract .
Uncertain event must be outside control of the party who agrees to bear the other party’s risk
Marine in writing, otherwise oral is possible but writing usually does
Prudential Insurance Co v Inland Revenue Commissioners
Consideration must pass from the insured to the insurer.
Insured must secure a benefit, upon the happening of some event, which involves an element of uncertainty as to whether the event will happen or not, or the time at which it will happen
NOT Insurance
Manufacturers' guarantees Cautionary obligations (accessory they can only be enforced following the default of the debtor in the principal obligation.
Financial Ombudsman Service
Insurance industry set it up. You don’t need to pay, only get assistance
Limit is now £150k
Clack v In Focus Asset Management & Tax Solutions - It has been decided can’t get anymore over statute maximum.
Sch 1 Financial Services and Markets Act 2000
Defines classes of general and long-term insurance business that must be carried out by authorised persons. Eg accident, illness, aircraft, credit etc
