Question

Question 6 (Note this question is from the Week 11 Tutorial) Required: A. Identify the four (4) key terms in Insurance Law. B. Briefly explain what indemnity means in Insurance Law. C. Briefly explain what the ‘doctrine of subrogation’ means and discuss its effect on the parties to an insurance contract. (Word limit: Minimum of 200 words. Maximum of 300 words)

Answer 1

A) Folowing are 4 key terms used in Insurance Law
Accident	This is an unexpected occuring or event, that happens by chance & the same isn't expected in normal course of evnts.
Basic Rate	This is the rate charged to insured for a particular type of risk accepted by the insurer.
Claim	This is a intimation or notice to insurer that under the policy term, particular loss may be covered
Clause	This is used to identify a particular part of a policy.
B) Indemnity
Indemnity may briefly be defined as making payment / compensation to one party by the other party.
This is based on mutual contact in between 2 parties that is to say between Insured and Insurer, in which one party promises to the other party to compensate for the loss for payment of premium.
C) Subrogation
Subrogation is a case where right of the insurer to assume the right of insured.
When the insurer has paid the loss to insured under the terms of policy, then Insurer enters into the shoes of Insured.He gets all the rights and remedies belonging to insured against third party with respect to any loss covered by the policy. In other words it may be understood that after settlement of loss, if insured gets any benifit in the same case then insured can not keep the benifit, and it is the insurer who is entitle to receive such benifit.