Page 186 - Liability Insurance IC74

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(b) Special features of Liability Insurance - Liability
insurances may be distinguished from insurances of
property, by reason of the following special features:

(i) Claims are paid to persons other than the insured
i.e member of the public or the insured's employees,
as the case may be, but on behalf of the insured.

(ii) The insurance provides indemnity to the insured in
respect of his potential legal libility i.e liability arising
under Common Law or Statutory Law.

(iii) Claims are negotiated and settled with consent of
insurers by the insured who is required, by policy
conditions, to cooperate with the insurers in this
respect.

(iv) Legal costs of the insured incurred with the written
consent of the insurers are reimbursed under the
policy.

(v) Instead of a 'sum insured' a limit of indemnity is
stated in general liability policies. In employer's
liability policies no limit of indemnity is incorporated.

(vi) Jurisdiction clause is important in liability insurance.
Cause of action may arise anywhere in the world
but insurers restrict their liability to courts within
specific jurisdictions, e.g foreign tourists may be
injured at tourist locations but choose to file for

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