Chapter 13 - Insurance

Question 1

What are the 6 steps involved in taking out insurance?

Answer 1

1. Calculate value of the item
2. Contact an insurance company/broker
3. Complete a proposal form
4. Pay premium
5. Company sends out insurance policy and certificate of insurance
6. Receive renewal note

Question 2

Insurance broker

Answer 2

Person who works for themselves and sells insurance for a number of different companies. Works on commission

Question 3

Insurance agent

Answer 3

Works for one insurance company. Gets a basic salary and commission

Question 4

Proposal form

Answer 4

Application form for insurance

Question 5

Insurer

Answer 5

Providing insurance company

Question 6

Premium

Answer 6

Fee paid for insurance

Question 7

Insurance policy

Answer 7

Written document from insurance company containing all the details of the insurance contract

Question 8

Insured

Answer 8

Person who took out insurance

Question 9

Certificate of insurance

Answer 9

Short, written summary of the main points of an insurance policy

Question 10

Cover note

Answer 10

Letter sent by the insurance company proving insurance is in place

Question 11

Renewal notice

Answer 11

A written reminder from the insurance company saying the next premium must be paid

Question 12

Grace period

Answer 12

A period of time when you have not yet payed your next premium but you are still insured

Question 13

What is life assurance?

Answer 13

Insurance to pay bills should one of the household’s income earners die

Question 14

What is endowment assurance

Answer 14

Special policy used as a way of saving. Works the same as normal life assurance but when the person reaches a certain age they cash in the policy themselves

Question 15

Surrender value

Answer 15

Value of life assurance when turned into cash

Question 16

What is temporary life assurance?

Answer 16

Insurance taken out on a loan incase you should die before fully repaying the loan

Question 17

Describe home insurance

Answer 17

• Has two parts: building and contents insurance

* Cost of premium could be reduced due to alarms, window locks, neighbourhood watch ect

Question 18

Third Party Fire and Theft

Answer 18

Minimum type of car insurance. If you have an accident, the insurance company will only pay for the other persons injuries and damage. However you do get compensation if your car is stolen or damaged by fire

Question 19

Comprehensive car insurance

Answer 19

• Most expensive

* Everyone in the accident is covered

Question 20

No claims bonus

Answer 20

A discount on your car premium if you had no accidents in the last year

Question 21

Health insurance

Answer 21

Pays for your hospital bills should you fall ill

Question 22

Salary protection insurance

Answer 22

Supplies you with a monthly income in case you fall ill and can’t work

Question 23

Personal accident insurance

Answer 23

Insurance in case you have a personal accident for example breaking a leg

Question 24

PRSI

Answer 24

By law everyone must pay a percentage of their income into a fund. Employees will be paid a sum of money out of the fund if any of the following occur:

 - Unemployment
 - Maternity leave and not paid by the employer
 - Become ill and are unable to work
 - Reached retirement age

Question 25

Travel insurance

Answer 25

The insurance company will pay for any bad things that happen while you're travelling

Question 26

What are the 5 rules of insurance?

Answer 26

1. Insurable interest 2. Upmost good-faith 3. Indemnity 4. Subrogation 5. Contribution

Question 27

All risks fire ins

Answer 27

Covers loss or damage to property caused by fire

Question 28

Consequential loss insurance

Answer 28

Pays for lost profits and pays for certain expenses should a business close down due to fire

Question 29

Burglary/theft insurance

Answer 29

Owner will receive money if stock, cash or equipment is stolen

Question 30

Transit insurance

Answer 30

In case cash or stock is stolen or damaged whilst being transported to or from the premises

Question 31

Employers liability insurance

Answer 31

Insurance company will pay money to any employees who are injured or killed whilst working

Question 32

Product liability insurance

Answer 32

Insurance company will pay money to any customers who were injured or killed due to faulty goods or services

Question 33

Fidelity guarantee insurance

Answer 33

Insurance company will pay business owner if any employee steals from the firm or causes business to lose money

Question 34

Insurance

Answer 34

Protection against something that might happen

Question 35

Assurance

Answer 35

Protection against something that will definitely happen

Question 36

Non Insurable risk

Answer 36

Sometimes the insurance company won't insure something because it would cost them too much to replace

Question 37

Policy excess

Answer 37

When you have to pay for some of the loss yourself

Question 38

What does PRSI stand for?

Answer 38

Pay Related Social Insurance

Question 39

Public Liability Insurance

Answer 39

Insurance company will pay money to any member of the public who is killed or injured on premises

Question 40

Insurable interest

Answer 40

You must benefit from having the item and suffer from its loss

Question 41

Utmost Good Faith

Answer 41

You must state truthfully while filling out a proposal form

Question 42

Indemnity

Answer 42

You cannot make a profit from insurance

Question 43

Subrogation

Answer 43

Say your car gets stolen and you receive compensation. If the car is found it now belongs to the insurance company. If you want it back, your must pay for it

Question 44

Contribution

Answer 44

If you have something insured with more than one company, each company will only pay part of the compensation