ECONOMICS
INSURANCE
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
policy
|
|
|
premium
|
|
|
insurance
|
|
|
risk
|
Detailed explanation-1: -An insurance agreement is a legal contract between an insurance company and an insured party. This contract allows the risk of a significant financial loss or burden to be transferred from the insured to the insurer. In exchange, the insured promises to pay a small, guaranteed payment called a premium.
Detailed explanation-2: -The Principle of Indemnity The insurer (provider) compensates the insured (policyholder). The insurance company promises to compensate the policyholder for the amount of the loss up to the amount agreed upon in the contract.
Detailed explanation-3: -An insurance contract issued by one insurer (the reinsurer) to compensate another insurer (the cedant) for losses on one or more contracts issued by the cedant. The party that has an obligation under a reinsurance contract to compensate a cedant if an insured event occurs.
Detailed explanation-4: -A document containing terms and conditions of insurance contract is called policy.