Licentiate Examination - IC 01 - Principles of Insurance Exam - Important Points
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Factors that affect indemnity - Deduction for Under-Insurance or the Condition of Average, Deductibles or Excess, Maximum amount recoverable in a Property Insurance Policy
Deduction for Under-Insurance or the Condition of Average: - If the insured insures his property for lesser than its actual value, it is unfair to the other contributors of premium to pay him the full loss.
The Principle of Insurable Interest gives the Person, the Right to insure a Subject-Matter, with which, they have a Relationship, recognised by Law. Insurable Interest can be on the Basis of Common Law, Contract, or Statute.
The Principle of Indermnity ensures that, Insurance places the Insured, in the Same Financial Position, after the Loss, as they enjoyed before it, Not Better.
In General Insurance, the Insured can be indemnified in 4 Ways: Cash, Repair, Replacement, Reinstatement.
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