Principles of Insurance
All insurance is based on the following five basic rules or principles:
- Insurable Interest
- Utmost Good Faith
To insure something you must benefit from its existance and should suffer financialy from its loss.
Utmost Good Faith
You must answer all questions truthfully and reveal all relevant information when completing the proposal form or claim form.
The insured person should not profit from insurance. Insurance exists to put the insured person back in the same financial position they were in before the loss, not a better one.
Once an insurance company... (More)