History of Insurance in the Philippines
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Questions and Answers

What is the principle that requires the insured to disclose all relevant facts to the insurance company?

  • Contribution
  • Utmost Good Faith (correct)
  • Subrogation
  • Indemnity

    • Which type of insurance is not a contract of indemnity?

  • Health insurance
  • Fire insurance
  • Life insurance (correct)
  • Marine insurance

    • What happens to the right of ownership of the property after compensation has been paid?

  • It remains with the insured
  • It is transferred to the government
  • It is transferred to a third party
  • It shifts from the insured to the insurer (correct)

    • What is the term for the pecuniary interest of the insurer in the subject matter of the insurance?

    <p>Insurable Interest</p> Signup and view all the answers

    Which principle applies when there is more than one insurer?

    <p>Contribution</p> Signup and view all the answers

    What principle ensures that the insured is compensated only for the incidents mentioned in the policy?

    <p>Proximate Cause</p> Signup and view all the answers

    What happens if the insured hides a fact that would increase their premium amount?

    <p>The insurer will void the insurance policy</p> Signup and view all the answers

    What is the purpose of the principle of indemnity?

    <p>To compensate the insured against possible damage or loss</p> Signup and view all the answers

    When was life insurance introduced in the Philippines?

    <p>1898</p> Signup and view all the answers

    What is the name of the first domestic non-life insurance company in the Philippines?

    <p>Yek Tong Lin Fire and Marine Insurance Company</p> Signup and view all the answers

    What is the Law of Large Numbers also referred to as?

    <p>Law of Average</p> Signup and view all the answers

    What is the main purpose of insurance?

    <p>To reduce risk by combining a sufficient number of exposure units</p> Signup and view all the answers

    What is a policy in the context of insurance?

    <p>A contract between an insurer and an insured</p> Signup and view all the answers

    When was the first domestic life insurance company established in the Philippines?

    <p>1910</p> Signup and view all the answers

    What is the primary function of the Law of Large Numbers in insurance?

    <p>To calculate the probable loss experience</p> Signup and view all the answers

    What is the main benefit of insurance?

    <p>To receive financial protection and reimbursement of damages</p> Signup and view all the answers

    What determines the cause of loss in insurance?

    <p>The peril that is most effective in causing the damage</p> Signup and view all the answers

    What is the main difference between public and private insurance?

    <p>The funding mechanism</p> Signup and view all the answers

    What is the primary purpose of life insurance?

    <p>To provide financial support for your family in the event of your death</p> Signup and view all the answers

    What is the function of a deductible amount in health insurance?

    <p>It is the amount the insured must pay before the insurer begins to pay</p> Signup and view all the answers

    What type of insurance provides coverage for damages or losses due to fire, theft, and other named perils?

    <p>Homeowner's insurance</p> Signup and view all the answers

    What is the purpose of a disability insurance policy?

    <p>To provide a percentage of an employee's wages if they become unable to work</p> Signup and view all the answers

    What is unique about whole-life insurance compared to term insurance?

    <p>It provides savings as well as insurance</p> Signup and view all the answers

    Which type of insurance is perhaps the most commonly held type of insurance?

    <p>Automobile insurance</p> Signup and view all the answers

    What is the benefit of purchasing coverage through a provider on a wholesale basis for its members?

    <p>It costs each individual worker/member less than if they had to purchase an individual policy</p> Signup and view all the answers

    What does a 'certificate of credible coverage' provide to an individual?

    <p>Necessary document to provide to a subsequent insurance company in the event of terminating coverage</p> Signup and view all the answers

    What type of insurance does Panibio not include?

    <p>Life insurance</p> Signup and view all the answers

    What is the primary characteristic of Variable Universal Life Insurance (VUL)?

    <p>It is a permanent life insurance and investment rolled into one product</p> Signup and view all the answers

    What is covered under Marine Protection and Indemnity Insurance?

    <p>Both personal injury or death and loss or damage to the vessel or property of another person</p> Signup and view all the answers

    What percentage of the VUL insurance premium goes to the cost of insurance in the Philippines?

    <p>5%</p> Signup and view all the answers

    What is not included in Panibio?

    <p>Insurance against loss by reason of bodily injury to any person arising out of ownership, maintenance, or use of automobiles</p> Signup and view all the answers

    What does the term 'variable' mean in Variable Universal Life Insurance (VUL)?

    <p>The investment returns vary depending on the rise and fall of the markets</p> Signup and view all the answers

    What is the primary benefit of Variable Universal Life Insurance (VUL)?

    <p>It provides financial protection for when the policyholder either dies too soon or lives too long</p> Signup and view all the answers

    What is the primary focus of Engineering Insurance?

    <p>Erection, testing and working of any machinery, plant or equipment</p> Signup and view all the answers

    What type of insurance covers bridges, tunnels, and other instrumentalities of transportation and communication?

    <p>Panibio</p> Signup and view all the answers

    What are the two types of private health insurance in the Philippines?

    <p>HMO and health insurance policies</p> Signup and view all the answers

    What is the characteristic of a permanent life insurance policy like VUL?

    <p>It does not expire as long as premiums are paid</p> Signup and view all the answers

    What is included in Panibio?

    <p>Both precious stones, jewels, jewelry, precious metals and bridges, tunnels and other instrumentalities of transportation and communication</p> Signup and view all the answers

    What type of insurance is not a type of Panibio?

    <p>Life insurance</p> Signup and view all the answers

    What does Engineering Insurance provide?

    <p>Complete protection against risks associated with erection, testing and working of any machinery, plant or equipment</p> Signup and view all the answers

    Study Notes

    History of Insurance in the Philippines

    • Life insurance was introduced in the Philippines in 1898 by the Sun Life Assurance of Canada.
    • The first domestic non-life insurance company, Yek Tong Lin Fire and Marine Insurance Company (now known as the Philippines First Insurance Company), was established on June 8, 1906.
    • The first domestic life insurance company, the Insular Life Assurance Company, Ltd., was organized in 1910.

    Law of Large Numbers

    • The Law of Large Numbers is a mathematical law that states that the accuracy of predictions about future outcomes increases when the number of similar, independent exposure units is increased.
    • This law is the theoretical basis of the business of insurance, as it allows insurers to predict collective losses and make predictions about future outcomes.

    Principles of Insurance

    • Insurance is a social device that combines the risks of individuals into a group, using funds contributed by members to pay for losses.
    • Utmost Good Faith: an insurance contract must be made based on utmost good faith, with the insured disclosing all relevant facts to the insurance company.
    • Insurable Interest: the insurer must have a pecuniary interest in the subject matter of the insurance.
    • Indemnity: insurance contracts, such as fire and marine insurance, are contracts of indemnity, where the insurer undertakes to compensate the insured against possible damage or loss.
    • Subrogation: the right of ownership of the property shifts from the insured to the insurer after compensation has been paid.
    • Contribution: if there is more than one insurer, the insurer can ask the other insurers to contribute their share of the compensation.
    • Proximate Cause: the property is insured only against the incidents mentioned in the policy.

    Types of Insurance

    • Public and Private Insurance: public insurance includes Social Security, Medicare, and temporary disability insurance, while private insurance plans are offered by private corporations or organizations.
    • Life Insurance: provides for the beneficiaries of the policyholder in the event of death, with two types: term insurance and whole-life insurance.
    • Health Insurance: covers the cost of hospitalization, doctor visits, and prescription medicines, with a deductible amount.
    • Disability Insurance: pays a certain percentage of an employee's wages or a fixed sum if the employee becomes unable to work due to illness or accident.
    • Homeowner's Insurance: provides insurance for damages or losses due to fire, theft, and other named perils.
    • Automobile Insurance: provides insurance for damages or losses due to accidents, with a group policy option for employees.
    • Variable Unit-Linked Insurance (VUL): a permanent life insurance and investment rolled into one product, providing living, death, and disability benefits plus an investment component.
    • Health Maintenance Organizations (HMO) and health insurance policies: two types of private health insurance in the Philippines.

    Marine Insurance

    • Marine insurance covers risks associated with the construction, repair, operation, or use of vessels, craft, or instrumentalities in use of ocean or inland waterways.
    • Includes liability for loss of or damage to the property of another person.

    Engineering Insurance

    • A comprehensive insurance that provides complete protection against risks associated with the erection, testing, and working of any machinery, plant, or equipment.

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    Description

    Learn about the introduction of life insurance in the Philippines, the establishment of the first domestic non-life insurance company, and the organization of the first domestic life insurance company.

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