Features of an Insurance Contract - Insurance And Social Responsibility
The major features of an insurance contract include;
The Declarations page
The declaration page has statements that establish the parties to the contract, the basis upon which the contract is issued, the information about the loss and the exposure of the insured object, the date of commencement and how long it will last, and the premium to be paid by the insured.
The Insuring Agreement
The insuring agreement contains the risks insured by the insurance company for example Jubilee Insurance Company will pay for loss or damage of your car and its attached accessories and spare parts by risk that is covered; fire, theft.
Exclusions
This provides the items excluded, this includes risks,property,losses,locations.For example the policy might provide that Jubilee insurance company will NOT be liable for any accident whilst your car is being driven by a third party beyond working hours.
Conditions
Under conditions the policy provides for what the insured ought to fulfill to sustain a claim in case he suffers loss. The conditions include Notice and proof of loss, cooperation between parties, suspension of coverage, examination and investigations. For instance you and any other person claiming indemnity must take all reasonable steps to maintain your car in an efficient and roadworthy condition.
Endorsements and Riders
These carry the same meaning but their purpose is to amend the policy and they apply only if referred to by number in the schedule. Endorsements are used in property insurance for example house, car while riders are used in life or health insurance.
Claiming indemnity from an Insurance company is not always easy especially if one has not fulfilled the terms and conditions they agreed to.It is vital to acquaint oneself with all the requirements of the policy and take reasonable care.
For more on this refer to the post about Formation and Formalities of an Insurance Contract.Insurance And Social Responsibility
Insurance can have various effects on society through the way that it changes who bears the cost of losses and damage. The role of Insurance to society has been quite debatable.
On one hand it has been averred that insurance has a positive impact on society in the sense that it ensures continuous investment (this includes the operation of the society) in society by assuming the risks involved. With the assumption of the risk and the losses thereto, the different elements of society such as business, health, sports are operational as the element of risk is minimized or eliminated.
It has also been argued that insurance can/may help societies and individuals prepare for catastrophes and mitigate the effects of catastrophes on both households and societies. In fact, the role of insurance in reinstating society after catastrophes is highly noted. For instance, insurance compensations made after the 2001, September 11 terrorist attacks in New York, the Tsunami floods in New Orleans and currently the Earth quake in Japan.
Whereas it is not a guarantee that such catastrophes are covered, it should be noted that where they are covered, Insurance plays a big role in protecting society and reinstating it to the condition prior to such mishap.
However, it has also been argued that insurance has some negative impact on society. The advocates of this argument have based this on moral hazard. It has been argued that due to moral hazard, insurance has a tendency of increasing risk to the society. The rationale is that with the existence of insurance, individuals in society tend to become more reckless and therefore neglect the duties of care that they owe other individuals in society and society as a whole.
Tags : Insurance Law