Insurance Chapter-15

Question 1

Insurance

Answer 1

An agreement between the insurer and the insured that the insurance company will pay out a certain amount of money is loss is occurred.

Protects you from what may or may not happen.

Question 2

Premium

Answer 2

The amount a person pays each month or year to for an insurance policy

Question 3

Type of house insurance

Answer 3

Life assurance
Property and contents
Health
Mortgage
Income
Travel
Motor

Question 4

Life assurance (house insurance)

Answer 4

Insurance taken out on a persons life for a certain period. Limp sum of money is paid if the person dies

Question 5

Endowment insurance (house insurance) (life assurance)

Answer 5

Lump sum of money is paid when a person reaches a certain age

Question 6

Whole life insurance (house insurance)

Answer 6

Lump sum of money is Paid when someone dies

Question 7

Car insurance (house insurance)

Answer 7

Fully comprehensive- cover the damage done to the policy holders car and other persons car. Also protects against fire and theft

Third party , fire , theft- cover the damage done to the other car involved in the accident

Question 8

contents insurance (house insurance)

Answer 8

Insurance that covers house contents such as furniture, electrical goods need to be insured in case of theft.

Question 9

PRSI (house hold and business

Answer 9

helps the government to pay for social welfare benifits

Pay related social insurance

Compulsory
Money comes out of employees gross income

PRSI is paid by employers on behalf of the employees

Question 10

Business insurance

Answer 10

Buildings and contents
Employers liability
Public liability
Product liability
Key person insurance
Plate glass
Cash in transit
Fidelity guarantee

Question 11

Product liability (business insurance)

Answer 11

Cover a business against claims made by consumers that were harmed if injured by a product

Question 12

Public liability (business insurance)

Answer 12

Covers a business against claims made by the public that who were injured on the business premises

Question 13

Employer liability (business insurance)

Answer 13

Covers against claims made by an employee made by accident , illness or injury in the workplace

Question 14

Key personnel (business insurance)

Answer 14

Cover the loss a business may suffer when a key employee leaves the business eg when a manger with specialised skills leaves to join a trivial firm. Cost to find a replacement is covers by policy

Question 15

Fidelity guarantee (business insurance)

Answer 15

covers a business against any loss suffered due to fraudulent activities eg theft

Question 16

Consequential loss

Answer 16

Covers a business against loss that can arise as a result of another risk happening eg fire = closed = loss of revenue is covered

Question 17

Cash in transit

Answer 17

Covers a business against theft of cash while it’s off the premises eg from business to bank

Question 18

Plate glass

Answer 18

Covers a business against large shop windows being damaged

Question 19

Risk management

Answer 19

A planned approach used by a business to identify potential risks it faces and calculates the cost of protecting themselves from them

Question 20

Principles of insurance

Answer 20

Utmost good faith
Insurance interest
Indemnity
Contribution
Subrogation

Question 21

Utmost Good faith

Answer 21

You must tell all relevant information. All questions on form must be answered truthfully.
Reveal all material facts.
Relevant to calculate risk eg smoking

Question 22

insurable interest

Answer 22

In order to insure something you must benefit from its existence and suffer from its loss

Question 23

Indemnity

Answer 23

You cannot make a profit from insurance.
No point in over insuring you house as they will only compensate for market value.

Question 24

Contribution

Answer 24

If a risk is insured with 2 different companies, each will pay half the compensation

Question 25

Subrogation

Answer 25

When compensation is paid , the insured passes the lea right over to the insurer to claim from a third party who caused the loss..?

Question 26

Compensation formula!!

Answer 26

Sum insured ——————-x loss Actual value

Question 27

Similar insurances between houses and businesses

Answer 27

Property and premises H: protects home against loss and damage B:covers the business premises for event like storm or fire Contents + motor

Question 29

Similarities and differences between a household and business

Answer 29

Similarities -polices (PRSI, motor ect!) -forms -risk management Differences -risk (businesses face a greater risk than households eg plate glass employers liability) -premium (businesses have higher premiums)