ABSTRACT
In an international engineering company the chief design engineer and the group insurance manager scarcely knew each other, apart from chance meetings at company occasions. In simple terms a risk is insurable if it can be properly identified, precisely defined, and quantified in words and figures for probability and severity. The insurer will put the risk alongside other similar ones and make a 'book' on the underwriting probabilities. The fundamental point for the designer is that a policy written on an occurrence form will respond to an occurrence happening during the period of insurance, without any reference to when the loss is discovered or when any claim is made by a third party. Insurance contracts are subject to the doctrine of utmost good faith – uberrimae fides. This is because they are different from other contracts in that only one party knows all about the risk, and that is the proposer.
