Principles and practices of insurance Saudi Arabian

220 Pages·2015·0.55 MB·English

Principles and practices of insurance

Saudi Arabian Monetary Agency

The Institute of Banking

Insurance Foundation Certificate Exam (IFCE) Preparatory Course

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

Learning Objective:

‘To introduce candidates to the need for insurance, the principles and legal
framework those underpin its practice.’

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

Foreword

Improving knowledge, developing skills, building careers

The insurance industry in the Kingdom has arrived.

The success of the new industry will rely on the knowledge and skills of the people who
work in the industry.

Professionalism in insurance is not an option but is a must.

As a first step in the development of Saudi Arabian insurance professionals, the Institute
of Banking has developed this foundation course in insurance which must be taken
before all other courses.

The Foundation Course has been formed with individual modules covering different
subject areas within insurance, protection and savings. During your studies, your
principal learning resource will be yourself and this courseware. However, the Institute of
Banking has also developed a classroom based presentation to accompany and support
this book.

The instructor of this program will guide your studies, develop your group discussions
and be able to fully explain those issues which are particularly complex. He will also
answer your questions on specific issues that you may find difficult.

There are three knowledge ratings used throughout the course which indicate the depth
of knowledge required for each topic. These are i. To be aware of , ii. To have knowledge of
and iii. To understand.

The courseware contains definitions and explanations throughout together with regular
short questions to check your understanding of the text. These questions are given in a
box and will either test your understanding of the topic or stimulate your thought
process and facilitate further discussion.

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

At the end of each module, there is a series of questions to test your knowledge of the
module. It is strongly recommended that these be completed before moving on to the
next module.

The IOB's goal of developing excellence amongst insurance professionals in the
Kingdom will only be achieved if each of us strives for insurance knowledge. This
program is here for your development. Use them!

Good luck, enjoy the Program and, may it be the stepping-stone to an interesting and
rewarding career.

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Copyright 2014 The Institute of Banking
Principles and practices of insurance

Course Content & Syllabus:
Module 1: Risk and Insurance
1.1 Meaning of risk
1.2 Categories of risk
1.3 Insurable risks
1.4 Uninsurable risks
1.5 Insurance as a risk transfer mechanism
1.6 Pooling of risk
1.7 Perils and hazards
1.8 Benefits of insurance
1.9 Reinsurance
1.10 Co-insurance and self-insurance
1.11 How an insurance company operates.

Module 2: Legal Principles of Insurance
2.1 Utmost Good Faith
2.2 Insurable Interest
2.3 Indemnity
2.4 Subrogation
2.5 Contribution
2.6 Proximate Cause

Module 3: Risk Underwriting
3.1 Material facts
3.2 Physical and moral hazards and the use of warranties
3.3 Proposal forms and broker’s slips
3.4 Surveys
3.5 Quotations

Module 4: The Insurance Market
4.1 Components of the insurance market
4.2 Intermediaries
4.3 Distribution channels
4.4 The role of ancillary players in the insurance

Module 5: The need for documentation
5.1 Proposal Forms and policy structure
5.2 Warranties and endorsements
5.3 Cover notes and certificates of insurance
5.4 Claim forms
5.5 Renewal invitations

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Principles and practices of insurance

Module 6: Regulation of the Insurance Industry in the Kingdom
6.1 Why the insurance and protection/savings industry needs to be regulated.
6.2 The Historical Background of the Insurance Industry in the Kingdom
6.3 Regulation of insurance in the Kingdom of Saudi Arabia

Module 7: Market Code of Conduct Regulation MCCR
7.1 Introduction
7.2 General Requirements
7.3 Standards of Practice
7.4 Appendix

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Principles and practices of insurance

Module 1: Risk and Insurance

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Copyright 2014 The Institute of Banking