Administrative Classification of Insurance by Other of Criteria


Generally, insurance classification has been an ongoing business. It could be classified in different forms according to the nature of interest affected. Each classification is viewed in a different form by different authorities.

The classification of insurance below seems to have taken the administrative convenience of pointing out those lists of insurance in the country that has acquired socio-economic or socio-political value.

A very good example is motor vehicle insurance which involves three different perspectives of insurance.

{i} Property insurance { this perspective of insurance indemnifies against the damage of the car itself},

{ii} Personal accident insurance { this majorly focuses against personal injury of the owners-driver and if it happened that the injury was sustained by another party outside the owner while driving the insured vehicle, indemnity will not be considered to such person},

{iii} Liability insurance { indemnify against damage to property of, or against personal injury melted on a third party}.

The major consideration here is on how the insured is prejudiced by the happening of the insured peril; personal injury/death, property damage/loss, or liability to the third party.

They include the following:

a. Personal insurance

b. Property insurance

c. Pecuniary insurance

d. Liability insurance.

Personal insurance

Personal insurance can be referred to as insurance of a person, it focuses on the human being as the subject matter of insurance.

Insurance here is taken on the life of the insured directly.

However, insurance of a person includes all items discussed under life assurances and some items under non-life insurance that relate directly to the person.

These are personal accident insurance and various policies under health/sickness insurance.

Personal accident insurance: This is an insurance contract that provides financial compensation to a policyholder who is a victim of an injury, sometimes resulting in death, due to an accident.

The level of the injury is specified, with the compensation payable being graded according to the nature of the injury.

Sickness insurance: It is common to every individual that not only accidents but also sickness can cause total disablement.

However, sickness insurance is a type of income protection policy that can help to make some financial provision and protection to someone who has been off from work due to sickness or injury.

Property insurance

Property can be defined as an object, movable or immovable, animate or inanimate, a material being or thing over which a person {natural or legal} exercises ownership control, either alone or joint ownership.

Also, some financial assets like money for instance cash at hand or in transit in the interest of the owner are included under property insurance. it is important to emphasize this point.

This is because the relationship of cash to term pecuniary may mislead a beginner into classifying cash under pecuniary insurance.

Property insurance is a broad term for a series of policies that are contracted to provide indemnity or liability coverage to the property owner in the event of damages or destruction of property which is graded according to the terms of the insurance.

The following insurance risks are under property insurance as listed by Ivamy {1979} marine insurance, fire insurance, burglary insurance, glass insurance, livestock insurance, war risk insurance, fidelity insurance, solvency insurance, and license insurance.

Liability insurance

Liability insurance provides protection or coverage to the independent business professionals, entrepreneurs {self-employed persons} and most importantly business owners{the insured
} against claims arising from injury or damages to other people’s property.

In the course of conducting one’s own life in a society, there’s the possibility of inflicting injury {damages or loss} to another person or institution, herein. called the third party.

However, liability insurance indemnifies against or covers the cost of compensation to the third-party claims.

i. Physical injury to another person, sometimes leading to loss of life

ii. Damage to another person property

iii. Damage to other persons and/or their interest due to non-observation ones statutory responsibilities. this would normally invoke legal action by the injury.

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