Lesson Notes By Weeks and Term - Senior Secondary 1
Indemnity
Indemnity
Term – 2nd Term
Week: 5
Class: Senior Secondary School 1
Age: 15 years
Duration: 40 minutes of 2 periods each
Date:
Subject: Insurance
Topic:- Indemnity
SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to
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 proximate cause |
Students pay attention |
|
STEP 2 EXPLANATION |
He defines indemnity and discusses its relationship with insurable interest
|
Students pay attention and participates |
|
STEP 3 DEMONSTRATION |
He explains the methods of indemnity |
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
INDEMNITY
In literary sense, indemnity is the restoration of the insured to same financial position after a loss as he enjoyed immediately prior to the loss. In insurance, indemnity is the mechanism by which insurers provide financial compensation to the insured in an attempt to place him in the same position after the loss as he enjoyed immediately before the loss.
The relationship between indemnity and insurable interest
- There is a direct link between indemnity and insurable interest.
- The provision of indemnity for a total loss will be in line with the extent of insurable interest in existence which is measurable in financial term.
- The indemnity payable would equal to the insurable interest at the time of the loss.
Note: With life and personal accident policies, there is normally an unlimited interest, which meansü an indemnity can never be given.
In indemnifying the insured, the guiding principle is usually “the sum insured or the market value”, whichever is less.
For full indemnity to be provided the sum insured must be adequate to represent the full value at risk, else it will be subject to average in event of partial loss to reduce the amount of claim.
The methods of providing indemnity/the options available to insurers to execute indemnity
The four basic methods of providing indemnity are:
This involves the insurance company giving cheques for the amount admitted by the insurer under the reported claims. It is the most popular method of claims settlement and very easy to execute.
This is the method applied by an insurer in settlement of motor and other property insurance claims. An object adequately repaired constitutes a full indemnity.
This is a method used by the insurer to replace an article lost due to the insured perils instead of making cash payment available to the insured. This may be possible with such items as jewelry and furs where depreciation will be very negligible and which the insurer could easily get a discount from a good dealer.
This is a method commonly used in fire insurance claims whereby the insurer promises to effect settlement through reinstating or rebuilding of subject matter of insurance to the position it was before the fire.
EVALUATION: 1. Define indemnity
CLASSWORK: As in evaluation
CONCLUSION: The teacher commends the students positively