insurance premiums and claims most is maths so is not here

Question 1

What is the fee for insurance called

Answer 1

Premium

Question 2

The premium called by the actuary will depend on

Answer 2

• The amount you want to insure the item for
• the type of insurance your looking for
• how many people want to take out the same insurance
• the chance of the loss occurring

Question 3

What does it mean to over insure

Answer 3

• an item for more than its value is said to be over insured
• The principle of idemnity says you cannot make a profit from insurance
• The most you can receive is the current value if the item

Question 4

What is under insuring

Answer 4

*a item is insured for lees than its value it is said t be under insured

Question 5

actuary

Answer 5

Calculates the premium being charged

Question 6

loading

Answer 6

extra amount charged by the insurance company to help replace/repair the damaged item

Question 7

What is an assessor

Answer 7

Is used to calculate the compensation to be paid when the loss occurs

Question 8

What factors should be considered when calculating the premium

Answer 8

• The amount you want to insure the item for
• the type of insurance you are looking for
• how many people want to take out the same type of insurance
• the likelihood of an accident happening or the loss occurring

Question 9

What are examples of loading

Answer 9

• younger people pay more for motor insurance
• people who smoke pay more for health insurance
• people who live in big cities pay more house insurance than those in small towns

Question 10

What are some ways to reduce a risk from happening

Answer 10

• installing a smoke or fire alarm in your home
• installing a sprinkler
• driving carefully, wearing your seat belt and getting your car serviced regularly
• not smoking
• taking regular exercise
• installing a car alarm

Question 11

What are some reasons our premium might have gone up from the last year

Answer 11

• we made a claim the previous year
• the item we are insuring has gone up in value
• we are changing the type of insurance we have
• the chance of the loss occurring has increased
• the insurance company’s costs have gone up and so they must increase everyone’s premium to cover their increased costs

Question 12

How do you calculate the premium

Answer 12

total premium= basic premium + loadings - reductions

Question 13

What is compensation

Answer 13

Compensation is the money paid to you by the insurance company to help you replace or repair the items that were damaged

Question 14

What does the insurance company want to make sure of before they give you compensation

Answer 14

• the loss or damage did actually occur
• a claim form has been properly been filled out
• you have actually insured for the loss that has occurred

Question 15

What is over-insuring

Answer 15

Insuring something for than it is worth