Insurance Connor Flashcards
Define risk management
It is the planned approach by a business and household to deal with risks which may affect them.
It involves identifying all the possible risks and putting measures in place to reduce them
How do you minimise risk?
Transfer risk to insurance company by paying a premium and then they will cover costs for any loses suffered
Install CCTV
Training for employees
Appoint a health and safety officers who do regular safely checks
Define insurance
It is protection against financial loss
What is a proposal form
The form you fill out when applying for insurance
What is a premium
It is the fee paid for insurance to the insurance company
What is loading
It is an additional charge on your insurance due to increased risk
Eg health insurance will be higher if you skoke
What is the no claims bonus
A reduction in the premium of there has been no claim made since the last renewal date
What is an actuary
A person who calculated the premiums paid
What is policy excess
When a claim is made the first portion of the claim is paid by the insurer and then the rest is paid by the insurance company
The higher the policy excess the cheaper the premium
What is an assessor
Person who calculates the compensation to be paid
What is a loss adjuster
If the insurance company is unhappy with the loses being claimed they can appoint an independent person to access the situation called a loss adjuster
What are the 5 principles of insurance
Indemnity
Utmost good faith
Subrigation
Contribution
Incurable interest
What is subrogation
Once you receive compensation you give up the right to make further claims
Eg you can sue an electrical contractor if your house burns down if your house insurance company has paid the compensation
What is utmost good faith
All material facts must be revealed
Failure to do this makes an insurance void
Eg a driver lying about the amount of penalty points they have
What is indemnity
An insured person cannot make profit from insurance
Eg if a car is written off and they crash it they can’t get the price they paid initially for it as compensation that will receive the replacement value
What is contribution
If you hold more than one insurer liable for loses, they have to share the loss
Eg having two insurance policies for your car would mean that if you were to get compensation they would share it
What is insurable interest
The insured must gain from the the existence of the insured item
Eg you can insure your neighbours house
What is the average clause used to calculate
Compensation if items are underinsured
To ensure they don’t profit from insurance
Name some types of insurance for a business
Product liability - protects from claims if customers get ill or injured while using their products
Public liability- cover against claims made if people become ill or injured on their premises
Employers liability - covers claims made by employees who are injured or becomes ill in the workplace
Goods in transit- loss suffered from the loss, damage or delay of goods in transit
Key personnel- losses suffered when key employees leave the business. Covers cost of financing a replacement etc
Fidelity gaurnetee- covers gains any loses as a result of fraudulent activities by an employee
Product liability - protects from
Types of insurance for a business or household are
Buildings and contents - provides cover for damages suffers to the structure of the building caused by flood fire or storm. It also covers damage to the items inside the building.
PRSI - taken from an employees gross pay and use to pay for social welfare
Motor insurance - required by law
Types of insurance to households only
Life insurance
Health insurance
Income protection - covers financial losses to a household if the main earner is unable to continue work
Mortgage protection - covers the cost of mortgage repayment if the household cannot make their repayment, e.g. due to illness or redundancy
What are the types of life assurance
Whole life
A premium paid until they die, which is then paid out when the insured dies
Endowment
Paid out when a policy reaches maturity, e.g. the 70th birthday or the insured dies which ever happens
First
Term life
Policies taken out for a certain length of time and the insurance company only pays out if they die during that certain length of time
