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Does the principle of indemnity state that the insured can be compensated for an amount equal to his economic loss?
Wiki User
∙ 9y ago
The principle Êof indemnity state that the insured Êcan be compensated for an amount equal to his economic loss Êbut not more. This means an insured cannot be compensated an amount exceedingÊeconomic loss.Ê
Wiki User
∙ 9y ago
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How does insurance sector help industry and economy?
Among the ways that insurance positively affects the economy and the industries that comprise it is by its fundamental namture. That is, an insurance policy, by its nature, "assumes the risk" of loss of fortuitous events. Stated otherwise, an insurance contract serves to indemnify the insured from the economic consequences of foreseeable occurrences. In return for the payment of a premium, the insurer becomes financially responsible for the damages sustained by a third party (or by the insured itself in the case of first-party insurance) as a result of an occurrence that is within the ambit of policy coverage. Were it not for insurance, a business enterprise would ordinarily responsible, from its own assets, for all such financial losses. Therefore, the protection that insurance affords protects the insured from that risk and allows it to allocate assets to business expansion or for other purposes.
What does the contribution principle determine in life insurance?
The concept has primary application to property insurance rather than to life insurance. In the context of property insurance, assume that the property owner or other person having an insurable interest in a building buys 2 policies from different insurers for, say $2million each. If a loss occurs and the insured makes a claim against one of the insurers, and it is paid, the paying insurer would have a right to recover half of its payment from the other insurer. In the context of life insurance, an insured can have multiple policies. As long as there is full disclosure to each of the insurers of the existence of the other(s), and each insurer is willing to underwrite the risk despite the existence of the other policy, each policy stands alone and pays upon the death of the insured. Naturally, the terms, conditions, and exclusions of the policy control whether or not payment is actually made.
What are the factors that discourage commercial banks involvement in informal economic activities?
Since federally insured banks are regulated by various levels of federal regulators and auditors/examiners, all banks must abide by uniform laws and as such any economic activity must be formally documented. Generally local games of chance, lotteries and that sort of thing are generally not bankable. Although, Chase Bank provided the financing to start the Oklahoma Lottery and other similar large scale games of chance.
What is an aggregate excess structure?
An Aggregate Excess (aka a Deductible) is a predetermined amount that the insured will bear in any one year for all insured losses occuring during that year. The amount can be stated as a dollar amount (ie. $xxxxx), as a percentage of the annual premium (ie. xx% of $AP), or as a predetermined percentge of the loss ratio (ie. insured to bear all losses under xx% of claims/AP%). An Annual Aggregate Excess is normally agreed by calculating the expected losses, using the prior history of insured losses and adjusting for trends etc..
Defense costs inside the aggregate limit?
The insurance company will pay for the cost of defending a claim made against the insured. The cost of the lawyers will be paid for on top of whatever limit of insurance the insured has paid for. ie if the insured bought cover of £1m and he was sued for £1m then the insurance company will pay up to £1m and in addition to this the insurer will also pay the cost for all the lawyers who tried to defend the claim.
What is Principle of indemnity?
The principle of indemnity is an insurance principle stating that an insured may not be compensated by the insurance company in an amount exceeding the insured's economic loss. "Financial compensation sufficient to place the Insured in the same financial position at the time of a loss, as he was enjoying immediately prior to the loss"
What exactly is insurance indemnity?
Indemnity insurance is compensation for the beneficiaries of the policies for their actual economic losses. This is typically up to the limiting amount of the insurance policy. It generally requires the insured to prove the amount of its loss before it can recover.
The difference between indemnity and non-indemnity insurance in insurance law?
When indemnity (often called short-term) insurance contracts are concluded the insured is entitled to recover the actual commercial value of what he has lost through the happening of the insured event, be such event damage to property, fire, theft, public liability or marine insurance. In non-indemnity insurance the sum which the insured is entitled to receive from the insurer does not necessarily bear any relation to the actual loss, if any, suffered by the insured. Life insurance contracts, personal accident and sickness insurance are examples of non-indemnity insurance. Rgds max_jaret@yahoo.com
What can be added to an insurance policy to allow the insured to receive higher benefit?
double indemnity. -Chrly
What can be added to an insurance policy to allow the insured to receive a higher benefit?
double indemnity. -Chrly
What can be added to an insurance policy to allow the insured to receive a higher benefits?
double indemnity. -Chrly
What can be added to an insurance policy to allowed the insured to receive a higher benefit?
Double indemnity can be added to an insurance policy to allow the insured to receive a higher benefit.
What can be added to an insurance policy to allow the insured to receive a higher benefit-?
Double indemnity can be added to an insurance policy to allow the insured to receive a higher benefit.
If a car is not being driven do you need to keep it insured?
If a car is not being driven you do not need to keep it insured. However if your car is damaged while uninsured you will not be compensated.
Which term describes the restoration of the insured person to the financial position he or she was in before the loss occurred?
Indemnity, 100% sure
Which type of hospital expense policy pays a fixed amount each day that the insured is in a hospital?
A Hospital Indemnity policy pays a fixed amount each day the insured is hospitalized, unrelated to medical expenses.
Can one item be insured in two countries?
Although it is common place to have more than one policy insuring a risk, Double Indemnity is Illegal. So long as a claim is not filed for the same loss and Double Indemnity does not occur then there is no problem.
