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đề cương Final insurance
Insurance in International Trade (Trường Đại học Ngoại thương)
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Chapter 1&2
1. What is insurance? Nature and benefit of insurance?
Definition of insurance 1
Insurance is a system of economic compensation commitment, in which the insured must contribute an amount of money called
insurance premium for the subject insured according to the prescribed insurance conditions, and the insurer is responsible for
compensating for the losses of the subject insured caused by the insured risks.
Definition of insurance 2
Insurance is the pooling of fortuitous losses by transfer such risks to insurers, who agree to indemnify insureds for such losses, to
provide other pecuniary benefits on their occurrence, or to render services connected with the risk
- Pooling of losses:
+ Pooling involves spreading losses incurred by the few over the entire group
+ Risk reduction is based on the Law of Large Numbers - the greater the number of exposures, the more closely will
the actual results approach the probable results that are expected from an infinite number of exposures.
- Payment of fortuitous losses: unforeseen, unexpected, and occur as a result of chance
Definition of insurance 2 (lớp cô Ngân)
A contract between two parties whereby one party called insurer undertakes in exchange for a fixed sum called premiums, to pay
the other party called insured a fixed amount of money on the happening of a certain event
Nature of the insurance
- Insurance provides financial protection against a loss arising out of the happening of an uncertain event. A person can avail
this protection by paying a premium to an insurance company.
- Insurance is the risk transferring from the insured to the insurer
- Insurance works on the basic principle of risk- sharing.
- The business object in the insurance sector is risk.
2. What are the principles of insurance?
If you break any rules here, the insurance co. will not compensate for your loss.
The principles of insurance are the foundational guidelines that ensure fairness, clarity, and legal integrity in insurance contracts. These include:
1. Fortuity (Random Loss, Not Certainty): The timing or occurrence of the loss must be uncertain and happen unexpectedly, without
intent or speculation
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2. Utmost Good Faith: A higher degree of honesty is imposed on both parties to an insurance contract than to other contracts. Any
concealment or misrepresentation can invalidate the contract
3. Insurable Interest: The insured must have a financial interest in the subject of the insurance at the time of the loss
4. Indemnity: The insurer agrees to pay no more than the actual amount of the loss. This principle does not apply to life or personal
accident insurance
5. Subrogation: The substitution of the insurer in place of the insured to claim indemnity from a third party
These principles ensure that the insurance contract is fair, transparent, and operates to mitigate financial risks without encouraging unethical
behavior or fraud.
3. Explain the principle "risk" of insurance? Give an example!
4. Explain principle "utmost good-faith" in insurance? Give an example!
5. Explain principle "insurable interest" in insurance? Give an example!
6. Explain principle "indemnity" in insurance? Give an example!
Principle Definition Analysis Purpose Example
Insurance is a The timing or occurrence of Insurance companies only Preventing buying insurance Example: You can't know your
repayment of a the loss must be uncertain accept insurance for after the incident. The house will be destroyed in 3
random loss or and happen unexpectedly, incidents, accidents, and insured should be careful and weeks and still buy
fortuity, not without intent or disasters that happen take care of their property homeowner's insurance
certainty or speculation unexpectedly, randomly, and carefully
risk beyond human control, but do
not insure risks that are
certain to occur and they are
predicted. Risks that violate
ethics or societal standards
are not covered
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In some cases: To be able to
fully service major claims,
small claims are not covered.
This is what the deductible is
for. Only damage or loss over
the amount of the deductible
is covered by the insurance
policy.
Utmost Good A higher degree of honesty Insurers: make sure the Its purpose is to ensure Example:
Faith is imposed on both parties insured understand the terms accurate risk assessment, The insured misrepresented that
to an insurance contract and conditions. prevent fraud, protect both she had no tra c violation
than to other contracts. Any parties, and maintain trust in conviction in the prior
concealment or The insured: must declare the insurance contract. three-year period. After an
misrepresentation can honestly about the subject accident, a check of her record
invalidate the contract matter, value of the property, revealed that she had two
etc. speeding tickets in that period.
The insurer denied coverage
3 doctrines of principle
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đề cương Final insurance
Insurance in International Trade (Trường Đại học Ngoại thương)
messages.pdf_cover_qr_code_label
messages.studocu_not_sponsored_or_endorsed_by_college
messages.downloaded_by
, lOMoARcPSD|26927854
Chapter 1&2
1. What is insurance? Nature and benefit of insurance?
Definition of insurance 1
Insurance is a system of economic compensation commitment, in which the insured must contribute an amount of money called
insurance premium for the subject insured according to the prescribed insurance conditions, and the insurer is responsible for
compensating for the losses of the subject insured caused by the insured risks.
Definition of insurance 2
Insurance is the pooling of fortuitous losses by transfer such risks to insurers, who agree to indemnify insureds for such losses, to
provide other pecuniary benefits on their occurrence, or to render services connected with the risk
- Pooling of losses:
+ Pooling involves spreading losses incurred by the few over the entire group
+ Risk reduction is based on the Law of Large Numbers - the greater the number of exposures, the more closely will
the actual results approach the probable results that are expected from an infinite number of exposures.
- Payment of fortuitous losses: unforeseen, unexpected, and occur as a result of chance
Definition of insurance 2 (lớp cô Ngân)
A contract between two parties whereby one party called insurer undertakes in exchange for a fixed sum called premiums, to pay
the other party called insured a fixed amount of money on the happening of a certain event
Nature of the insurance
- Insurance provides financial protection against a loss arising out of the happening of an uncertain event. A person can avail
this protection by paying a premium to an insurance company.
- Insurance is the risk transferring from the insured to the insurer
- Insurance works on the basic principle of risk- sharing.
- The business object in the insurance sector is risk.
2. What are the principles of insurance?
If you break any rules here, the insurance co. will not compensate for your loss.
The principles of insurance are the foundational guidelines that ensure fairness, clarity, and legal integrity in insurance contracts. These include:
1. Fortuity (Random Loss, Not Certainty): The timing or occurrence of the loss must be uncertain and happen unexpectedly, without
intent or speculation
messages.downloaded_by
, lOMoARcPSD|26927854
2. Utmost Good Faith: A higher degree of honesty is imposed on both parties to an insurance contract than to other contracts. Any
concealment or misrepresentation can invalidate the contract
3. Insurable Interest: The insured must have a financial interest in the subject of the insurance at the time of the loss
4. Indemnity: The insurer agrees to pay no more than the actual amount of the loss. This principle does not apply to life or personal
accident insurance
5. Subrogation: The substitution of the insurer in place of the insured to claim indemnity from a third party
These principles ensure that the insurance contract is fair, transparent, and operates to mitigate financial risks without encouraging unethical
behavior or fraud.
3. Explain the principle "risk" of insurance? Give an example!
4. Explain principle "utmost good-faith" in insurance? Give an example!
5. Explain principle "insurable interest" in insurance? Give an example!
6. Explain principle "indemnity" in insurance? Give an example!
Principle Definition Analysis Purpose Example
Insurance is a The timing or occurrence of Insurance companies only Preventing buying insurance Example: You can't know your
repayment of a the loss must be uncertain accept insurance for after the incident. The house will be destroyed in 3
random loss or and happen unexpectedly, incidents, accidents, and insured should be careful and weeks and still buy
fortuity, not without intent or disasters that happen take care of their property homeowner's insurance
certainty or speculation unexpectedly, randomly, and carefully
risk beyond human control, but do
not insure risks that are
certain to occur and they are
predicted. Risks that violate
ethics or societal standards
are not covered
messages.downloaded_by
, lOMoARcPSD|26927854
In some cases: To be able to
fully service major claims,
small claims are not covered.
This is what the deductible is
for. Only damage or loss over
the amount of the deductible
is covered by the insurance
policy.
Utmost Good A higher degree of honesty Insurers: make sure the Its purpose is to ensure Example:
Faith is imposed on both parties insured understand the terms accurate risk assessment, The insured misrepresented that
to an insurance contract and conditions. prevent fraud, protect both she had no tra c violation
than to other contracts. Any parties, and maintain trust in conviction in the prior
concealment or The insured: must declare the insurance contract. three-year period. After an
misrepresentation can honestly about the subject accident, a check of her record
invalidate the contract matter, value of the property, revealed that she had two
etc. speeding tickets in that period.
The insurer denied coverage
3 doctrines of principle
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