Personal Insurance

What is insurance?

Remember the 4 P's
  • Protection against something that may occur (a possible risk), causing loss or damage, in order to get compensation.
  • You pay money to gain insurance. This is called a Premium. The Insurance Company look at all the risks in order to calculate the  premium.
  • Once you have paid the premium, you will receive a contract from the insurance company. This contract is called a Policy.
  •  You complete a form in order to gain insurance. It’s like a application form it is called a Proposal Form.

Principles of insurance

  • Utmost good faith: You must tell the whole truth when apply for insurance.
  • Insurable interest: You must have an interest in what you are insuring, u must gain from its existence and suffer from its lose.
  • Indemnity: You cannot make a profit out of insurance.
  • Contribution: If you are insured with two companies you cannot claim the full amount of each.

 Important Insurance Terms

Claim form:
 A form u fill out after an accident to claim
compensation. You must tell the whole truth when filling this out.

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Actuary:employed 
by insurance company to determine the risk involved &  to calculate the
premium.

Insurance brokers: They ring around companies & see what policy is best for you .The fee you pay them is call “brokerage”.

Loss adjuster: If company feel customer making false claim they send out a LA to put correct value on damage done.

Loading: This is increase in your premium because you have an extra risk e.g. smoker.

No claims bonus: If u don’t have any claim in  a set amount of time year you might get a discount.

Assessor: A person making a claim may also hire an assessor to determine the amount of compensation.



Here is an excellent Presentation on Insurance

Types of Insurance

                                                                  Motor Insurance
Fully comprehensive: More expensive, covers all parties,
1st party = You and your car,      
2nd party = Your passengers,
3rd party = anybody else
Third party fire and theft:
A cheaper form, this does not cover yourself only if your car is stolen or destroyed by fire.

                                                     Home Insurance

Home insurance: 
This covers the actual building. Home Insurance is usually made up of "home" AND separately the "contents" of the house.

Assurance: this is protection against something that will definitely happen eg. Death

Endowment:  
This is where you pay money for a set amount of time e.g.10 years, after which you receive a lump sum payment. It's a cross between saving and investing.
Whole life insurance: 
This is when you pay money into your policy for your whole life and upon your death your next-of-kin receive a lump sum amount.

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