Lesson Notes By Weeks and Term - Senior Secondary 1

Insurable and uninsurable risks

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Term – 1st Term

Week: 9

Class: Senior Secondary School 1

Age: 15 years

Duration: 40 minutes of 2 periods each

Date:       

Subject:      Insurance

Topic:-       Insurable and uninsurable risks

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

  1. Explain the meaning of insurable and uninsurable risks
  2. Outline the characteristics of insurable risks and give examples of each
  3. Give examples of uninsurable risks

INSTRUCTIONAL TECHNIQUES: Identification, explanation, questions and answers, demonstration, videos from source

INSTRUCTIONAL MATERIALS: Videos, loud speaker, textbook, pictures

INSTRUCTIONAL PROCEDURES

PERIOD 1-2

PRESENTATION

TEACHER’S ACTIVITY

STUDENT’S ACTIVITY

STEP 1

INTRODUCTION

The teacher reviews the previous lesson on risk

Students pay attention

STEP 2

EXPLANATION

He explain the meaning of insurable risks and uninsurable risks

 

Students pay attention and participates

STEP 3

DEMONSTRATION

He outlines the characteristics of insurable risks and gives examples

He gives examples as well of uninsurable risks

Students pay attention and participate

STEP 4

NOTE TAKING

The teacher writes a summarized note on the board

The students copy the note in their books

 

NOTE

INSURABLE AND UNINSURABLE RISKS

Insurable risk 

It is a type of risk that the chance of occurrence can be deduced from the available information on the frequency of similar past occurrences. 

It is a risk that conforms to the norms and specifications of the insurance policy in such a way that the criterion for insurance is fulfilled. 

Insurable risks are risks that insurance companies will cover. These include a wide range of losses, including those from fire, theft, or lawsuits.

Uninsurable risk 

Uninsurable risk is a type of risk which the insurer is not ready to insure against simply because the likely future loss cannot be estimated and calculated. 

It is a risk that holds the prospect of gain as well as loss.

It is a risk that cannot be forecast and measured.

Uninsurable risks are those that fall within the definition of speculative risks and fundamental risks which have to do with situation centered by the society we live in.

Insurable risk in life 

  1. Risk of pre-mature death
  2. Risk of disability
  3. Risk of retirement
  4. Risk of medical expenses etc.

 

Insurable risk in property

  1. Motor vehicle; chance of the vehicle being involved in accidents
  2. Buildings; risk of fire outbreak Buildings;
  3. risk of burglary

 

Characteristics of insurable risk 

  1. The risk is potentially costly enough that a business is willing to pay a premium to protect against it.
  2. The risk can’t be so catastrophic that the insurer would never be able to pay for the loss.
  3. The risk is well-defined and has a clear, measurable value that can’t be influenced by the policyholder.
  4. The risk is random, not within the policyholder’s control, and the policyholder cannot cause or influence the loss.
  5. The risk must involve element of uncertainty resulting to financial loss
  6. There must be large number of similar risks.

 

Examples of insurable risk 

  1. Risk of pre-mature death
  2. Risk of disability
  3. Risk of retirement
  4. Risk of medical expenses
  5. Theft of properties

EVALUATION:    1. Explain the meaning of insurable and uninsurable risks

  1. Outline the characteristics of insurable and uninsurable risks giving examples of each

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively