Proposal Forms

Resumen

Before any insurer will cover you, it wants to know exactly who you are, what you own, and what you are asking it to carry. It gathers all of that on one printed sheet: the proposal form. It looks like an ordinary application, yet the small print at its foot quietly turns every answer you write into a promise, and that promise decides whether your claim is ever paid.

In this lesson you will learn what a proposal form is, the five kinds of information it collects, and the work it does for the underwriter who prices your risk. You will see how it puts the duty of disclosure into practice, why the declaration at the bottom matters more than anything above it, and the exact mistakes on a form that let an insurer walk away from a claim.

Objetivos

Define a proposal form and describe the information it gathers
Explain the functions and uses of a proposal form in the underwriting process
Explain how the proposal form gives effect to the duty of disclosure
Describe the legal status of the proposal form once the contract is concluded

Nota de la lección

A driver in Ibadan fills in a motor proposal form. Where it asks whether anyone else will drive the car, she writes that she alone will. Months later her nephew borrows the car, crashes it, and she puts in a claim. The insurer reads the form, points to her answer, and refuses to pay a kobo. She feels cheated, but the ground was laid the day she signed. Every word on a proposal form can be held against the person who wrote it, because the form is where the whole contract of insurance begins. Learn how it works and you learn where cover is won and lost.

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Evaluación de la lección

Felicitaciones por completar la lección del Proposal Forms. Ahora que has explorado el conceptos e ideas clave, es hora de poner a prueba tus conocimientos. Esta sección ofrece una variedad de prácticas Preguntas diseñadas para reforzar su comprensión y ayudarle a evaluar su comprensión del material.

Te encontrarás con una variedad de tipos de preguntas, incluyendo preguntas de opción múltiple, preguntas de respuesta corta y preguntas de ensayo. Cada pregunta está cuidadosamente diseñada para evaluar diferentes aspectos de tu conocimiento y habilidades de pensamiento crítico.

Utiliza esta sección de evaluación como una oportunidad para reforzar tu comprensión del tema e identificar cualquier área en la que puedas necesitar un estudio adicional. No te desanimes por los desafíos que encuentres; en su lugar, míralos como oportunidades para el crecimiento y la mejora.

The document a person completes to apply for insurance cover is the: A. Cover note B. Policy document C. Proposal form D. Renewal notice Answer: C
The person who completes a proposal form is known as the: A. Underwriter B. Proposer C. Broker D. Actuary Answer: B
The clause at the foot of a proposal form that makes every answer a warranty is the: A. Arbitration clause B. Average clause C. Basis of the contract clause D. Excess clause Answer: C
A proposal form gives effect chiefly to the principle of: A. Indemnity B. Utmost good faith C. Contribution D. Subrogation Answer: B
Which of the following is NOT normally a function of a proposal form? A. Supplying information to the underwriter B. Helping to fix the premium C. Paying the claim to the insured D. Providing a record of what the proposer disclosed Answer: C

Accede a todos los materiales de aprendizaje.

Practica con preguntas de años anteriores.

Sigue tu progreso

Accede a todos los materiales de aprendizaje.

Practica con preguntas de años anteriores.

Sigue tu progreso

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Preguntas Anteriores

¿Te preguntas cómo son las preguntas anteriores sobre este tema? Aquí tienes una serie de preguntas sobre Proposal Forms de años anteriores.

WAEC SSCE - Insurance - 2017

Pregunta 1 Informe

(a)(i) What is a proposal form?
(ii) List four general questions that are contained in a proposal form.

(b) List and explain three documents used in effecting insurance contracts.

Respuesta

(a)(i) What a proposal form is

A proposal form is the printed document supplied by the insurer which the intending insured (the proposer) completes and signs to apply for insurance cover. It contains a set of questions through which the proposer supplies all the material facts about himself and the subject matter of the insurance. The information given forms the basis of the contract, enabling the insurer to assess the risk, decide whether to accept it and fix the appropriate premium.

(a)(ii) Four general questions contained in a proposal form

The full name and address of the proposer.
The age, sex and occupation of the proposer.
A description of the subject matter to be insured and the sum to be insured (its value).
Details of previous insurance and claims history, including whether any insurer has ever declined, cancelled or refused to renew a policy.

(Other acceptable general questions: the period of insurance required and a declaration that the answers are true.)

(b) Three documents used in effecting insurance contracts

Proposal form: As explained above, it is the document by which the proposer formally applies for cover and discloses the material facts on which the insurer bases its decision. It represents the offer stage of the contract.
Cover note: A temporary document issued by the insurer to confirm that cover is in force pending the preparation of the full policy. It gives the insured immediate protection and states the main terms, remaining valid for a short period (often 30 or 60 days) until the policy document is ready.
Insurance policy (policy document): The formal, legal contract between the insurer and the insured. It sets out in detail the names of the parties, the subject matter, the risks covered, the sum insured, the premium, the period of cover, the exclusions and the conditions. It is the conclusive evidence of the terms of the agreement.

(The certificate of insurance and the premium receipt are also acceptable documents.)

Detalles de la respuesta

(a)(i) What a proposal form is

(a)(ii) Four general questions contained in a proposal form

The full name and address of the proposer.
The age, sex and occupation of the proposer.
A description of the subject matter to be insured and the sum to be insured (its value).
Details of previous insurance and claims history, including whether any insurer has ever declined, cancelled or refused to renew a policy.

(Other acceptable general questions: the period of insurance required and a declaration that the answers are true.)

(b) Three documents used in effecting insurance contracts

Proposal form: As explained above, it is the document by which the proposer formally applies for cover and discloses the material facts on which the insurer bases its decision. It represents the offer stage of the contract.
Cover note: A temporary document issued by the insurer to confirm that cover is in force pending the preparation of the full policy. It gives the insured immediate protection and states the main terms, remaining valid for a short period (often 30 or 60 days) until the policy document is ready.
Insurance policy (policy document): The formal, legal contract between the insurer and the insured. It sets out in detail the names of the parties, the subject matter, the risks covered, the sum insured, the premium, the period of cover, the exclusions and the conditions. It is the conclusive evidence of the terms of the agreement.

(The certificate of insurance and the premium receipt are also acceptable documents.)

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