Insurance Questions and Answers

average clause. is an insurance policy that restricts the amount payable to a sum not to exceed the value of the property destroyed and that bears the same proportion to the loss as the face of the policy does to the value of the property insured.

The purpose of an endorsement is a policy change. Insurance companies create endorsements to offer options to insureds to add coverage or increase coverage limits, but insurers may also issue special endorsements to limit or restrict coverage. Insurance endorsements are used in property and casualty insurance.

Contract Subject matter of insurance is the life, limbs, property, rights or any potential legal liability insured under a policy.Subject matter of contract is the insured's financial interest in the subject matter of insurance.

Insurable interest is an essential requirement for issuing an insurance policy which makes the entity or event legal, valid and protected against intentionally harmful acts. People not subject to financial loss do not have an insurable interest.

Loading the player... A risk premium is the return in excess of the risk-free rate of return an investment is expected to yield; an asset's risk premium is a form of compensation for investors who tolerate the extra risk, compared to that of a risk-free asset, in a given investment.

A level premium is a type of insurance premium that is regularly associated with term life insurance. The term level premium basically means that you are going to have the same premium payment for the entire life of the policy.

The pure premium "refers to that portion of that rate needed to pay losses and loss-adjustment expenses".

natural premium. : the amount required to meet the mortality cost of life insurance for each particular year and increasing from year to year for any given unit of protection.