FREQUENTLY ASKED QUESTIONS
Who is the "Adjuster"/ "Loss Adjuster"?
A person appointed by an insurer or insured to assess and quantify the extent of the damages to claims. Adjusters are licensed by the Central Bank.
Who is the "Agent"?
Person who acts on behalf of an insurance company and usually accept proposals for insurance for a commission. Agents are licensed by the Central Bank.
Who is the "Broker"?
An independent licensed insurance adviser who acts on behalf of his client when placing insurance cover with an insurer. Unlike an agent, he may obtain quotations from different insurers. Brokers are licensed by the Central Bank.
What is a "Casualty"?
Liability or loss arising out of an accident.
What is "Casualty Insurance"?
Class of insurance business that covers liability or financial loss arising out of an accident and payments of compensation to third parties who suffer bodily injury or death.
What is a "Contribution"?
Refers to the way two or more insurance policies covering the same risk will share loss. However, locally it commonly refers to the amount an insured will pay towards the cost of a new replacement part in motor claims when a used part is not available.
What is "Contributory Negligence"?
The sharing of liability by the claimants involved in an accident.
What is "Constructive Total Loss" (CTL)?
If the repair cost is 50% or more of the actual market value of the asset, the asset is deemed by the insurer a CTL.
What is a "Deductible"?
Same as “excess”. This is the amount the insured must bear before the insurer pays. If the claim in below the deductible, no amount is payable by the insurer.
What is "Depreciation"?
The decrease in value of an asset over time as most assets have a limited useful life. After an accident, the value is established by applying a depreciation factor to reflect the remaining useful life of the asset.
What is a "Discharge Form"?
A form which a claimant is required to sign on settlement of a claim, which states that the insurer’s liability has been fully settled and no further claim arising out of the same event can be presented.
What is an "Excess"?
An excess is the amount that you are responsible for in the event of a claim. This means that both the insured and the insurer share in the cost of claims. It also encourages the policyholder to exercise greater care in avoiding accidents.
What is an "Exclusion"?
Terms in an insurance policy under which the insurer will not pay if loss sustained is caused by an event or peril that is not covered.
What is "Exposure"?
The measurement of risk.
What is "Fraudulent Misrepresentation"?
The deliberate provision of wrong and/or misleading information to an insurer when completing an application for insurance. An insurer can deny a claim if the information provided is material and fraudulent.
What is "Indemnity"?
A principle that states that the policyholder should be returned to the same position that he/she was in immediately prior to the loss – there must neither gain nor loss. This is to protect the insurance company by ensuring that the policyholder has not gained from the loss.
What is "Liability"?
An obligation on a policyholder to pay damages arising out of an event. The obligation can be legally enforced.
What is "Loss of Use"?
This is an uninsured loss. The insurer will compensate the claimant for “Loss of Use” using a per-day monetary value. Payment is calculated by multiplying the daily rate by the number of days that the adjuster estimates it will take to repair the vehicle.
What is "Market Value"?
The current price of an asset that the average buyer will pay and the average seller is willing to accept.
What is "Material Fact"?
Information that, if disclosed, will influence the decision of a prudent underwriter and therefore must be made known to the insurance company at the time of providing information.
What is "Misrepresentation"?
Misrepresentation can be innocent or fraudulent. If innocent, it is unlikely to affect insurance cover after the passage of time. However, if fraudulent, it is deemed deliberate and intended to mislead the insurer and can render the policy void and of no effect. No claim may therefore be paid.
What is a "No Claims Discount"?
A No Claims Discount (NCD) is a reward given to the policyholder who maintains a claims free experience. A discount is given each year when there is no claim on the policy up to five years.
What is an "Occurrence"?
An event (a loss) which triggers payment.
What is a “Personal accident”?
Personal accident refers to the accidental death or injury to the insured. The insurance company will pay compensation to the insured and/or spouse or their personal representative.
What is a "Salvage"?
The value of an asset in its damaged condition or the disposable value of the wreck which can be sold for its parts.
What is "Subrogation"?
The right of an insurer, after settling a claim, to pursue recovery against the party that is responsible for the loss, usually against the insurer of the liable party.
What is "Sum Insured"?
The amount stated in the policy. It represents the limit that the insurer will pay in the event of a total loss.
What is a "Term"?
An insured period.
Who is the “Third Party”?
The person who may have been injured or whose property was damaged, other than the insured or the insurer.
What is "Utmost Good Faith"?
A principle of insurance that states that all parties must act on the basis of trust. However, the applicant for insurance has a duty to provide all information that will assist the underwriter in assessing the risk in order to arrive at an appropriate premium. Generally, in the commercial sector, the principle is known as “let the buyer beware”.
Why is it important to do a valuation?
Valuations play a vital role in ensuring that you insure your vehicle for that value that it is worth on the local market. This is particularly important as claims are paid based on the market value of the vehicle.
