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Kavita

www.insuranceandfinancediaries.com

Find me for my further updates @ www.insuranceandfinancediaries.com


Thanks and regards,


Kavita

www.insuranceandfinancediaries.com

Find me for my further updates @ www.insuranceandfinancediaries.com
 

Thanks and regards,


Kavita

Proximate Cause

Indemnity is provided when the cause of loss falls within the scope of the policy coverage. There is no liability in an insurance policy when the loss is caused by an uninsured or excluded peril.Sometimes , loss can be caused by more than one cause acting simultaneously or one after another. Is becomes necessary to find out the most important and effective cause of loss. This cause is called the 'proximate cause'.

For example, There was damage to stock in a godown caused by fire. Losses by fire is covered under a Fire insurance policy. Later on, it was found out that the fire was caused due to the negligence of an employee . Damage due to negligence is not covered under the fire policy. But since the proximate - cause has now been identified as damage caused due to negligence, the claim does not fall under the scope of policy and is not payable.

General Insurance Applications

The main application used in the operating office of the general insurance industry is the Front office System, The applications are written in any of the computer language and may differ between office to office among the insurance companies.

A well designed front office system of a general insurance company allows the insurers and agents to manage the day to day operations of the office. The main components of the Front Office System should include:

• Policy management and underwriting
• Coinsurance
• Reinsurance 
• Claims 
• Management Information Services 
• Statistics and Investments
• Accounts 

These should enable the business transactions to become effective and efficient. The system should be easy to handle, should reduce office expenses and enable efficient customer services also. The system should be easy to handle the large and growing volume and variety of business of the insurance company.

'Increased value' Insurance

Marine cargo insurance covers risks in respect of loss or or damage to goods during transit by rail, road, sea or air. The market value of the cargo is taken to be the sum insured. 

There are occasions, before reaching the port of destination, the market value of the goods at the destination port is higher than the CIF (cost, insurance and freight) and the duty value. 

The 'Increased Value' insurance clause arranges insurance to cover the increased value of the cargo. The clause is attached to the policy and provides indemnity for the increased value because of the operation of any of the perils insured against.The clause is not valid if there is an increase in the market value after the arrival of the vessel at the destination port.

Agreed Bank Clause

The agreed bank clause is attached to an insurance policy in the event when the bank has a partial interest in the property that is insured or when the insured property is mortgaged. The policy is issued in the name of the bank or mortgagor. 

• Any claim that arises will be paid to the bank in full and final discharge of liability under the insurance policy.

• Notice for alteration in risk  factors under the policy when given by the bank is considered as sufficient.

• Arbitration   in the event of claim settlements when made with the bank will be binding on all parties insured.

• The changes in risk due to alterations or increase will be updated within the policy, provided the bank notifies the same within a reasonable period of time and and pays additional premium.

Software Application in Life Insurance

The software application in life insurance categorizes three types of data of operational offices engaged in the procurement and servicing of policies.

1) Accounting module; The billing details contain the name and address, policy number, premium payment and installment details. Receipts and other accounting notices are printed in the module.

2) Policy module: This module contains the name, address and policy number, installment premium details, agency code number, commission payment details and coinsurance and reinsurance details.

3) Claims module: It contains the master records that has the necessary information for assessing the liability of the policy for a claim made and also the liability under the policy at any point of time. 

The software application is made possible by electronic data processing and are designed by tools using Structured System Analysis and Design (SSAD).