Page 27 - M1_Insurance Introduction Notes
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Voluntary Private Insurance
Here, individuals and groups can buy insurance from an
insurance company by entering into a contract of
insurance with the company.
An insurance contract promises to make good to the
insured by paying a certain sum in consideration for
the premium received from the insured.
The insurance company enters into a contract (an
insurance policy) whereby it (insurer) undertakes, in
exchange for a small amount of money (premium), to
provide financial protection by agreeing to pay the
insuring person (insured) a fixed amount of money
(sum assured) on the happening of a certain event
(insured peril).
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