INSURANCE CONTRACT

MA. Ton Thi Thanh Huyen Insurance Faculty- NEU

Main points
1. Introduction to insurance contract 2. Forming insurance contract

1. Introduction to Insurance contract

What is Insurance Contract?

Commitment in the written word 2 parties: Insurer Participant transforming the risk

Insurance Contract
Civil contract or

Commercial contract?

Conditional contract

Requirements of a valid ins. contract

On the subject matter On parties capability On parties acceptance

Requirements of a valid ins. contract

On the subject matter

Existence of the subject matter Origin of the subject matter

On parties capability
Legal ability Financial ability

Requirements of a valid ins. contract

On parties acceptance
No default No duress No misunderstanding

Types of insurance contract

Voluntary/compulsory ins. contract Core/additional ins. contract Group/private ins. contract Package/single ins. contract Ins. contract for the interest of own participant/for the interest of the third person Property/ Liability/Health & Life ins. Contract
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Stakeholders of ins. contract

The Insurer The Purchaser The Insured The Beneficiary

Rights & Obligations of the parties

The participant ????? The insurer ???????

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Features of insurance contract

Bi-lateral Adhesion Utmost good faith Aleatory

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2. Forming an insurance contract

The proposer

The Proposal

Declaring information of risks

The insurer

Evaluating proposed risks

Issuing cover note

Issuing Insurance policy

Announcing the refusal

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The Proposal

The questionnaire designed by the insurer in order to gather all information of proposed risks. Expressing the applicants will to reach an insurance contract. Supplying information to evaluate the proposed risks. Main content of a proposal have to:
Describe the subject matter; Describe the risk;

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The Proposal
Structure of the proposal including 4 parts:
(1) General questions (2) Specific questions related to the proposed risks (3) Commitments (4) Warnings

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Obligation of information disclosure

Basic facts

Misrepresentation or non-representation
Innocent? Intentional?

Responsibility of proof

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The Cover Note

A temporary certification of insurance commitment between 2 parties. To get a cover note:

After the proposal is considered preliminarily After the premium is paid in total or in a part (exceptions for some

insurance)

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The Cover Note

The effect of a cover note

Temporary (normally in 30 days) All claims in these days belongs to the responsibility

of the insurer
Being ceased when:
?????

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The Policy
The

evidence in writing of an insurance contract of representing the policy:

Principles

Strict, logical structure Standard grammar rules Simple words Clear language

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The Policy - Structure of the policy

Heading Preamble Signature clause Operative clause Exceptions Conditions Schedule Definition
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The Policy- operative clauses

General clauses:
Being applied for all policies in the same insurance line; Designing the standard form for the insurance line:
Insurable risks; Exceptions; Authority; Rights and obligations of parties; Limited time for making claim; The place of adjusting; paying; etc.

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The Policy- operative clauses

Specific clauses: making differences among various policies in the same insurance line:
personal data; the subject matter; features of insured risks; The premium; etc.

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The Policy- conditions

In order to regulate the coverage of the policy:
What the insurer or the insured is able to do? What they have not to do? What they have to do? And What they do?

Example:

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