ELEMENTS OF INSURANCE NOTES

1. Parties: The parties to an insurance contract are the insurer ad the insured.
2. Premium: This is the consideration which passes from the insured to the insurer to support the contract.
3. Risk: This is the probability or chance of loss, it is the probability of an outcome adverse to what is expected or hoped for. Insurance is one of managing risk. In an insurance contract, risk exists in priori while in a wagering contract risk is created by the contracted. It was so held in Robertson V. Hamilton
4. Uncertainty: For insurance to exist there must be uncertainly as to whether the event will ever occur and if it must occur there must be uncertainty as when it was so held in Prudential Assurance Company V. Inland Revenue Commission
5. Insurable Interest: This is the monetary or pecuniary interest which a person has in subject matter which he is likely to lose should the risk occur. The interest may be legal or equitable
6. Control: The insurable event must be beyond the control of either party.
7. Negligence: Insurance is only sustainable where loss is likely to be accidental or a consequence of a negligent act or omission.