The legal forms of Conventional Insurance
What are the legal forms of Conventional Insurance?
From historical background of conventional companies, we find that three predominant legal forms have been used as follows:
- Association of Individuals (Lloyds);
- Stock companies; and;
- Mutual associations.
A Lloyds Association is an organisation of individuals joined together to underwrite risks on a co-operative basis. Here the individual underwriter assumes risks in his own name and does not bind the organisation for his obligations. Each underwriter is individually liable for losses on which he has assumed risks. Thus it can be said that a Lloyds Association is proprietory organisation bent on profit and the underwriter is always an individual. On the other hand, a stock company is the corporate body of stock holders which is organised a.s a profit making venture in the field of insurance. However, the mutual companies, and the clubs or associations are organised as non-profit corporate body which is owned by policy holders as there are no stock holders.
What are the objections against conventional life insurance What are the objections against conventional life insurance? There are various reasons cited by those who do not accept life insurance …
The weaknesses of conventional non-Life Insurance What are the weaknesses of conventional non-Life Insurance? One can not deny the fact that insurance system has certain inherent weaknesses. For example, the …
Different methods of re-insurance What are the different methods of re-insurance? Reinsurance can be effected broadly by two methods: (a) Facultative; and (b) Treaty. Facultative reinsurance is effected only in …
What is Reinsurance It is understood that in insurance the fund of the policyholders is managed by insurance companies and the losses incurred by a few are shouldered by many. …
The Actuarial Principle of Life Insurance The actuarial side of life insurance is the function of mathematicians. An actuary or mathematician with the help of mortality table can calculate the …
What are the social and economic values of Insurance? Dr. Mark R. Greene in his book “Risk and Insurance” has listed some of the social and economic values of insurance …
How Life Insurance schemes meet the saving needs How Life Insurance schemes meet the saving needs? The purchase of life insurance leads itself to a regular, consistent savings plan. The …
How insurance protects value of life? The main economic problem which arises when someone in the family dies, is the loss of earnings of the deceased person. In a business …
What is the greatest value of Insurance? Insurance is a socio-economic institution that reduces risk both to society and to individuals. This is done by combining under one management, a …
What is the main function of Insurance? We all know that life is full of uncertainty. We can not avoid the risks in life and hence insurance. This is because …