Insurance And Risk

Question 1

Getting insurance

Answer 1

In order to obtain insurance a person must have an insurable interest ( i.e. Your body, your life, your car) Policy: contract with an insurance company.
Insurer: insurance company.
Premium: amount you pay for the insurance coverage.
Deductible: amount you agree to pay before asking insurance company for money.

Question 2

Basic insurance terms

Answer 2

Claim: formal method of asking insurance company for money.
Liability: legal responsibility for the financial cost of another person’s losses or injuries.
Rider: special addition to a policy that covers a specific loss jot covered in the standard policy.

Question 3

Insurance and risk

Answer 3

Insurance: protection against possible financial loss.
Risk: chance of loss or injury.
Peril: anything that may possibly cause a loss.
Hazard: anything that increases the likelihood of loss through peril.
Negligence: failure to take ordinary or reasonable care to prevent accidents from happening.