Insurance PPT INSURANCE CONTRACT KI.pptx

INSURANCE

1. Contracts of various Kinds Presented By:- Kanika Goyal Parul Banyal

2. Table of contents 01 INTRODUCTION 02 FEATURES OF INSURANCE CONTRACT 03 Insurance v/s Service contract 04 Insurance v/s Gambling Conclusion 05

3. Contract – It refers to an agreement enforceable by law (Indian Contract Act 1872). It is an agreement between two parties to perform a particular obligation. Parties involved – Offeror and Offeree Insurance Contract - It refers to a contract whereby one party, in consideration of certain sum of money called premium undertakes to indemnify another party against any loss or to pay to that party an agreed sum of money on the happening of a certain event. Parties involved – Insurer and Insured INTRODUCTION

4. Conditional Features of Insurance Contract The Insurer is not obligated to perform if the conditions set forth in the contract are not met. The Insured does not promise to meet the conditions but he cannot force the Insurer to perform unless he does so. Insurance contracts are said to be aleatory i.e. the values given up by the parties are unequal. The insurer may pay a large claim in return for a small amount (premium) or he may not pay at all. Aleatory

5. Market analysis Unilateral Personal Only the Insurer makes a promise to do something, the insured on the other hand after payment of premium does not make any promises, though he must comply with the conditions if he wants the insurer to perform. Insurance contracts are personal meaning thereby that it is the loss to person and not to the property itself that is insured. You may say your car is insured but actually its you who is insured against financial loss caused by something happening to your car. The Insurance contracts are contracts of Adhesion. Most commercial contracts are formulated after bargaining between the parties to the contract but Insurance contracts are created by the insurers alone and they are presented to the insured and he can take them as they are or leave them. Adhesion

6. Insurance v/s Service contract 01

7. Insurance v/s Service Contract Basis Insurance contract Service contract Definition It refers to a contract whereby one party, in consideration of certain sum of money called premium undertakes to indemnify another party against any loss or to pay to that party an agreed sum of money on the happening of a certain event. Agreements to provide repair or maintenance services for a specific duration. Coverage Covers specified risks outlined in the policy, such as property damage, liability, or medical expenses. Covers repair, replacement, or maintenance of covered products or systems. Payment Premiums paid regularly (monthly, annually, etc.). Paid upfront or in installments. Claims Filed when an insured event occurs. Filed when a covered product or system requires repair or maintenance.

8. Insurance v/s Service Contract Basis Insurance contract Service contract Termination Can be terminated by the insurer or policyholder Can be terminated by either party according to contract terms Reinsurance Reinsurance is a part of insurance contracts. Not applicable as service contracts do not involve reinsurance. Examples Life insurance, Health insurance, marine insurance etc. Machinery maintenance, Car service, electronics servicing.

9. Insurance v/s Gambling 02

10. Insurance v/s Gambling Basis Insurance contract Gambling Meaning It refers to a contract whereby one party, in consideration of certain sum of money called premium undertakes to indemnify another party against any loss or to pay to that party an agreed sum of money on the happening of a certain event. Gambling refers to betting of something of value with consciousness of risk and hope of game on the outcome of a game, a contest or an uncertain event whose result may be determined by chance Insurable interest Insurable Interest is a pre-requisite In gambling the interest is limited to the amount to be won or lost. User identity The Insured is immune from loss and his identity is known before the event Gambling the loser cannot be identified before the event. Utmost good faith Full disclosure (Utmost Good Faith) is required from both parties to an assurance contract Not necessary

11. Insurance v/s Gambling Basis Insurance contract Gambling Enforceability by law Insurance contract is enforceable at law There is no legal recourse for any of the two parties in a gambling contract Type of Risk involved Pure Risk [loss Or No Loss] Speculative Risk [loss Or Gain] Example Health Insurance, Life Insurance Marine Insurance Etc. Casinos, Lottery Horse Racing Etc

12. Conclusion Insurance contract provide peace of mind to the insured and covers pure risk of an individual which is a situation of loss or no loss. Insurance contract provide a sense of security hence should not considered same as service and gambling. Insurance Contract is Adhesive and is not subjected to any negotiation and changes.

13. Resources Insurance Management (Himalayan Publishing House) Kinds of Contract - PDF

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