Page 83 - M1_Insurance Introduction Notes

importance in the banking sector which is good

for the insurance sector.

Limitations of insurance

In spite of number of advantages of insurance, it has

certain limitations. On account of such limitations, the

benefits of insurance could not be availed in full.

 All the risks cannot be insured. Only pure risks can

be insured and speculative risks are not insurable.

 Insurable interest (financial interest) i.e. the

subject matter of insurance either at the time of

insurance or at the time of loss, or at both the

times must be present, in the absence of which

the contract of insurance becomes void.

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