Interest and economic need in insurance is called insurance interest. It is due to the lack of external guarantees of financial protection of one or more entities. In addition, this can be explained by the risky nature of social production, as well as the need for insurance protection of property, health, working ability, life and income.
One of the main doctrines of insurance is a person who insures something and undertakes to incur financial losses if the insured risk materializes. Many are interested in the question of what is the insured amount and what is its size.
Deciphering the concept
Sum insured - this is the amount within which the insurance company is responsible, according to the contract for property insurance. Based on its size, the calculation of the contribution and payment. In property insurance, the maximum value of this amount is determined by the value of interest at the time the insured event occurs.
It is worth considering the fact that it is not the thing itself that is considered in the first place, but the owner’s interest in preserving it. Basically, the assessment coincides with the cost of reimbursing the item in the condition in which it was at the time of insurance. At the same time, wear is deducted from it.
Is it possible to increase or decrease the insured amount
To date, regulatory documents allow you to adjust its size in accordance with changes in the insurance value of property. In addition, there is a mention of its increase by a specific percentage accrued at the beginning of each subsequent year. The insurance amount will be adjusted by the percentage change in the price index of consumer goods. At the same time, its dynamics in the past year compared to the next year is taken into account. Thus, the percentage change in the cost index is calculated, which is rounded to the nearest whole number.
Enterprises that have inconsistent inventories may face significant difficulties. This occurs when a stock insurance contract is concluded with a clearly defined insurance amount. This problem can be solved. Types of insurance amounts include performing a procedure on a specific day. In this case, the contract will include the highest value of inventories.
The premium that must be paid for the entire insurance year is set based on half the insurance amount. In the process of the contract, the entrepreneur must inform the insurer about the price of production stocks on the indicated day of each month. The premium amount will be determined at the end of the insurance year and calculated on the basis of the declared actual indicators.
Is it possible to reduce the amount for hull insurance
AT CASCO regulations all companies indicate that the sum insured should not exceed the market value of the car at the time of drawing up the contract in a particular region. There are enough ways to determine it taking into account wear.
CASCO insurance amount reduction is possible. In this case, the insurance will be called proportional or incomplete. The market price of a used car can fluctuate within certain limits, and in order to save money, you should choose the lower limit. But it’s worthwhile to understand that the company will compensate the damage in proportion to the ratio of the insured amount to the real price of the car at the time of the transaction. It is understood that the CTP insurance amount has a similar calculation procedure.Its increase can be considered as an attempt to fraud, and for this reason it is theoretically impossible.
Kinds
Insurance practice applies the following types of insurance amounts:
- aggregate;
- aggregated;
- definable;
- certain;
- recoverable;
- increasing;
- decreasing;
- standard
- floating;
- by risk;
- on the object of insurance;
- by the beneficiary.
The most important of them are worth considering in more detail.
Defined and definable insured amount
An amount of a certain type is established, referring to a different value, for example, the insured value of the property, which is indicated in the contract. This method is the most acceptable for fixing the obligations of the insurer. At the same time, these species are found infrequently.
A definable insurance amount is the amount of the company's obligations, which is indicated in the insurance contract. Arithmetic operations are preliminarily performed to determine its size. The amount of this type is used in most reinsurance contracts. In this case, it will be set in the form of a quota on the insurance amount specified in the main contract.
Non-recoverable and recoverable amount
Non-recoverable (aggregate) insurance amount is the amount of liabilities, which may decrease as payments are made by the insurance company. This option is also quite common in contracts. Its use will be reflected in the provisions of the standard insurance rules. They stipulate that the amount of the insured amount will be reduced by the amount of one or more payments made. After the full and proper performance by the insurance company of the obligations assumed under the contract, it will be terminated.
The recoverable insurance amount is not applied often. This is due to the presence of risk for the insurer. The fact is that in such a case the insured amount on deposits should be reimbursed by them in full every time the policyholder incurs losses. In addition, this applies to cases of home insurance and vehicles. This is beneficial for the insured, so he will be compensated for the damage caused.
Amounts by insurance object, by risk, by beneficiary
The sum insured for the insurance object is the limit of liabilities that applies to a certain object of insurance. This form is most often established when insuring property complexes or when drawing up combined contracts involving the use of several types of insurance at the same time.
The sum insured for risk (by event) is found in civil liability agreements and combined property insurance. It determines the limit value of obligations to the occurring adverse event. These amounts may be differentiated. This is affected by the number of victims, as well as the nature of the harm done.
The sum insured by the beneficiary is the amount of the company's obligations for insurance payment to each insured when there are several of them in the drawn up contract. In this case, they can be determined according to certain categories of risks, on the basis of which insurance is carried out. Beneficiaries may be the spouse and children of the policyholder. Moreover, the contract shall indicate the share of each of them, payable in the event of an insured event.
What interests cannot be insured
Having considered the concept of the insured amount, it is worth knowing that not all interests of citizens are subject to insurance. They are defined by law. It is not allowed to insure such illegal interests as losses incurred as a result of participation in lotteries, bets and games, as well as expenses incurred in order to free hostages. If the contract was drawn up taking into account one of them, it will be considered invalid as a whole.
In addition, under a risk insurance contract, in case of breach of the contract, only the risk of the insured is insured. The document will be invalidated if the sum insured is greater than the insured value of the property. You should pay attention to these details when contacting the company.
