INSURANCE DOCUMENTS

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 Course Learning Outcomes

 Distinguishclearly the various principles in

insurance related aspects

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 PROPOSAL FORM

 An insurance contract is effected when there

is an offer an acceptance
 Offer is made through the completion of
proposal form and duly signed by the
proposer

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 The usefulness of proposal form

 To assist the insurer in gathering information

required to assess the risk proposed
 To enable the insurer to consider application
speedily and accurately

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 The structure of proposal form
 Requirements of Insurance Act 1996
 Questions of general nature
- Proposer’s name and address
- Risk address
- Proposer’s occupation
 Previous and present insurance
- loss experience
- sum insured
- subject matter
 Insurance related questions
- questions which are specific to the type of insurance
 Declaration
- requires the proposer to warrant the answers are true; the information is complete;
agree the proposal forms the basis of contract; accept the usual form of policy for that
class of business
 Signature
- the proposer should always sign the proposal form as it represents the offer in
the contract
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 COVER NOTE

 Evidence of protection for a temporary period

of time
 It provides provisional cover which the
insurer reserving the rights to withdraw the
cover
 Provides usual coverage as in a standard
policy; the contract is subject to tariff
warranties and special clauses
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 The contents
 Name and address of the insured
 Time and date of commencement of cover
 Period of insurance
 Description of risk covered
 Sum insured
 Rate and premium
 Any special terms
 Cover note serial number
 Date of issue
 Signature of the authorised signatory
 Terms of cancellation
 Statement to the effect

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 CERTIFICATE OF INSURANCE

 Normally issued when insurance is made

compulsory (motor insurance)
 It certifies that the insurance is issued by an
authorized insurer
 As an evidence of insurance to police and
motor vehicle’s registration authority

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 POLICY FORMS

 Is a document drafted by an insurer

 Is not a contract but as a written evidence
 Need to be stamped
 Issued as a scheduled type

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 The contents

 Heading : full name and address of the insurer

 Preamble/recital clause : introduces the parties to
the contract
 Operative/insurance clause : specifies the perils
insured and the circumstances the insurer will
become responsible
 Exclusions : restrictions on the scope of insurance

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 The contents

 The schedule : information applicable to a

contract – insured’s name and address,
premium, policy no., date of issue, risk
covered, period of insurance
 Attestation/signature clause : signature of an
authorized official of the insurer
 Conditions : regulates the contract – express
conditions, implied conditions
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 ENDORSEMENT

 Used to modify the terms and standard policy documents

 May be issued during the currency of the policy to record
alterations
 Alterations of :
- Variation in sum insured
- Change of insurable interest by way of sale, mortgage
- Extension of insurance to cover additional perils
- Change in risk
- Transfer of property to another location
- Cancellation of insurance
- Change in name and address

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 RENEWAL NOTICE

 Usually issued a month prior to the expiry, reminding

the insured the existing policy will expire on a certain
date
 All relevant information of the policy : insured’s
name, policy no., expiry date, sum insured, premium
 Advise the insured to disclose all material alterations
in the risk, to revise the sum insured ( market value)

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 CLAIM FORM

 Document used to gather information

relevant to assess claim : insured’s identity,
insured’s interest in the loss, circumstances
and extent of loss
 It does not constitute admission of liability of
the insurer

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 DISCHARGE LETTER
 When a claim payment is settled, insured’s is required to execute a discharge
 To avoid the possibility of any further claims on the loss

The insured declared that he :

- Has received a sum of money from the insurer
- The money received is in full satisfaction of his claim
The third party :
- Has received a sum of money form the insurer
- The money is paid on behalf of the insured
- The money received is in full satisfaction
Settlement not by cash :
- repair, reinstate or replacement has been effected
- The work was carried out to the satisfaction of the claimant

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