文档介绍：A Short Course in Non-Life Insurance
(Philippine Setting)

Part 1: Introduction

1. DEFINITION OF INSURANCE
We define Insurance as “ a contract whereby one undertakes for a
consideration to indemnify another against loss, damage or liability
arising from an unknown or contingent event”. It is a social device
wherein the losses of a few are distributed among the many which
otherwise would be borne by the few. It is a scheme whereby one
substitutes a small definite loss for a large but uncertain loss under an
arrangement in which the fortunate many who escape loss will
compensate the unfortunate few.

2. NATURE OF INSURANCE CONTRACT

An insurance contract is an agreement under which one party is obligated
to make good the loss suffered by a second party through the occurrence
of a designated event. The event must be a fortuitous one or beyond the
control of either party.

A contract of insurance is an agreement, whereby one party on the one
hand called the Insurer undertakes for a consideration called the
premium to indemnify, one or more parties called the Insured against
loss, damage or liability arising from an unknown or contingent event.

3. ESSENTIAL ELEMENTS OF INSURANCE CONTRACT

a) Competent Parties – there must be a legal capacity to give
consent or to enter into contract.
b) Subject Matter – the subject or object must be within the
commerce of man and it must be lawful.
c) Offer and Acceptance – there must be meeting of the minds
between the two parties.
d) Consideration – there must be a payment of a premium to the
Insurer for the assumption of the risk.
e) Insurable Interest – there must be an economic loss to the
Insured at the happening of the contingency insured against.

4. PRINCIPLES GOVERNING INSURANCE CONTRACT

a) Good Faith – the doctrine of uberrimae fidei (utmost good faith)
meaning that any concealment or misrepresentation o