Page 232 - Misc Ebook IC 78

The Insurance Times

Q1.a) The Personal Accident policy is deemed to
be a benefit policy. Explain the statement
with reference to the principle of indemnity
and its corollaries.

Ans. The Personal Accident policies are not strictly contracts
of indemnity. This is because life is precious and cannot
be compensated by money. However on practical
consideration a measure of indemnity does come into
play. Majority of these policies are termed 'benefit
policies' as they are distinct from the indemnity policies.

This is because in the event of happening of an insured
event a specified sum of money is payable irrespective
of the amount of pecuniary loss actually suffered by the
insured or his dependents, which in any case cannot be
measured. However, this does not mean that the insured
can make unnecessary profit out of this policy.

When policies are issued to employers to reimburse their
employees or their dependents on the disablement or
the death of their employees, the insured are indemnified
with the exact amount of compensation paid by them.

Website: www.bimabazaar.com Call: 033-22184184 / 40078428 228

Copyright@ The Insurance Times. 09883398055 / 09883380339