Fire and Consequential Loss Insurance - IC 57 Exam Study Notes

The term ?salvage? means i. All property covered by insurance which escapes destruction or damage from the operation of an insured peril. ii. The residual value of property which is partially damaged. This property may be reconditioned or sold in order to determine the amount of the loss. iii. The amount of money received from the sale of the damaged property. In fact this may be better expressed as 'proceeds from the sale of salvage'.
Subrogation means that the insured?s rights of recovery of loss from a third party responsible for the loss are transferred to the insurers who may recover the loss from the party concerned.
Duties of the insured i. Observe good faith; ii. Insured must take immediate steps to extinguish the fire; iii. Co-operate with fire brigade personnel
Under a fire policy, the onus of proving that the loss was the direct result of fire is on the insured.
The essence of the insurance contract is provision of indemnity for financial loss suffered by the insured as a result of the happening of an event insured against under the policy.

Important Points for IC 57 - Fire and Consequential Loss Insurance Exam