BANKING AFFAIRS

Detailed explanation-1: -Maximization of Profit is not the principle of insurance. There are seven basic principles that create an insurance contract between the insured and the insurer: Utmost Good Faith, Insurable Interest, Proximate Cause, Indemnity, Subrogation, Contribution and Loss Minimization.

Detailed explanation-2: -In insurance, there are 7 basic principles that should be upheld, ie Insurable interest, Utmost good faith, proximate cause, indemnity, subrogation, contribution and loss of minimization.

Detailed explanation-3: -Principle of Indemnity This principle says that insurance is done only for the coverage of the loss; hence insured should not make any profit from the insurance contract.

Detailed explanation-4: -According to the Principle of Loss Minimization, the insured must always try their level best to minimize the loss of his insured property, in case of sudden events like fire etc. The insured must take all necessary steps to control and reduce the losses and to save what is left.

Detailed explanation-5: -In the insurance world there are six basic principles that must be met, ie insurable interest, Utmost good faith, proximate cause, indemnity, subrogation and contribution.