MANAGEMENT

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BUISENESS MANAGEMENT

INSURANCE

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Jeevan has insured his property with 2 insurance company Oman Insurance company and Continental Financial services for AED 2 million and AED 6 million respectively for fire. Due to fire he suffers a loss of AED 1 million and he files a claim for AED 1 million from each company. Will he get his claims? If not, why?
A
Yes he will receive his claims.
B
No. because he has violated Principle of Insurable Interest.
C
No. because he has violated Principle of Contribution.
D
No. because he has violated Principle of Indemnity.
Explanation: 

Detailed explanation-1: -Issue: Reinsurance, often referred to as “insurance for insurance companies, ” is a contract between a reinsurer and an insurer. In this contract, the insurance company-the cedent-transfers risk to the reinsurance company, and the latter assumes all or part of one or more insurance policies issued by the cedent.

Detailed explanation-2: -According to the Principle of Subrogation, after paying the compensation, the insurer steps into the shoes of the insured.

Detailed explanation-3: -The principle of Utmost Good Faith is also known as Uberrimae Fides. Which of the following principles of Insurance assures about the financial interest that the assured possesses in whatever is being insured? Some Extra: The person (the assured) should possess the thing whatever he has opted to get insured.

Detailed explanation-4: -The principle of indemnity does not apply to Life and Personal Accident insurance.

There is 1 question to complete.
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