Basic Principles of Insurance


In the insurance agreement, there are several principles that must be understood and obeyed by both parties so that insurance coverage becomes valid, that is:

Insurable Interest:

It is the right to insure, arising from a financial relationship, between the insured and the insured and legally recognized.

Thus, you are said to have an interest in the object of the insured if you suffer financial loss in case of a disaster that causes loss or damage to the object. This financial interest allows you to insure your property or interests. In the event of an accident on an object insured and proven that you have no financial interest in the object, then you are not entitled to indemnification.

Utmost Good Faith:

It is an act to express accurately and completely, all material facts about something that will be insured whether requested or not. The meaning is: the insurer must honestly explain clearly everything about the extent of the condition / condition of the insurance and the insured must also provide a clear and true description of the object or interest that is insured.
The point is that you are obliged to provide as clear and accurate as to all the important facts related to the object insured. This principle also explains the risks that are guaranteed or excluded, all terms and conditions of coverage clearly and thoroughly.

Proximate Cause:

It is an active, efficient cause that leads to a chain of events that results in a consequence without the intervention of an active and initiated start from a new and independent source.

So if the interests of the insured or unfortunate accident, then first sought the causes of active and efficient that moves a series of events without interruption so that in the end there was a disaster or accident.

A principle used to find the cause of active and efficient losses is: “Unbroken Chain of Events” is an unbroken chain of events.


It is a mechanism whereby the insurer provides financial compensation in an attempt to place the insured in his / her financial position shortly before the occurrence of loss (KUHD article 252, 253 and affirmed in article 278).


Is the transfer of claim rights from the insured to the insurer after the claim is paid.

The principle of subrogation is stipulated in article 284 of the Law on Trade Law, which reads: “If an insurer has paid full compensation to the insured, then the insurer shall replace the position of the insured in all matters to prosecute a third party that has caused loss to the insured”.



It is the right of the insurer to invite other insurers who both bear, but not necessarily the same obligation to the insured to participate in giving indemnity.

You can just insure the same property on several insurance companies. However, in the event of loss of an insured object it automatically applies the principle of contribution.

Baca juga:

Pengertian Asuransi

Fungsi dan Tujuan Ber-Asuransi

Jenis Resiko yang Dapat Diasuransikan

Merencanakan Program Asuransi

Istilah Dalam Asuransi


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Planning an Insurance Program


To follow an insurance program you should plan to get maximum results.

Among other things we need:

Setting Insurance Objectives.

In managing risk, there are things that are underlying, such as the possibility of damage or loss of property you have. Your decision to buy a new car should be balanced by protecting against possible loss and possible damage to the vehicle’s physical damage.

Gather information about the Insurance You Want to Follow

To be able to understand this, you should try to gather as much information as possible about everything about the insurance program, such as what or who should be insured, the types of insurance that are needed, the level of premiums, and the credibility of the insurance company.

Choose the type of insurance

Choose insurance that is in accordance with the budget planning that you have made, recalculate your insurance needs starting from the need to buy life insurance, health, then insurance that protects all your property or assets. Do it one by one and try to stay realistic with income and budget.

Evaluate the Selected Program

Think about the next two or three years or when there are changes in your life phase, such as getting married, having children, and owning your own home. The need for the sum insured in insurance will increase along with the increase in the number of people who become objects of dependence in the family or bear the life needs of your parents.


Baca juga:

Prinsip Dasar Asuransi

Fungsi dan Tujuan Ber-Asuransi

Jenis Resiko yang Dapat Diasuransikan

Pengertian Asuransi

Istilah Dalam Asuransi


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Insurance Functions and Purposes


An accident or misfortune can happen at any time. Therefore it is good we consider to follow the insurance program, or in everyday language is said: enter insurance.

It is intended to minimize or reduce the risk arising from the accident. With insurance we can transfer the risk to the insurance.

In other words Insurance can be useful as:


By having an insurance policy, the insured person will avoid the possibility of risk of loss in the future and feel safe and calm his soul because the insured object has been guaranteed by the insurer policy.

Aside from being a means of protection, Insurance can also serve as:


Saving Infrastructure

Saving infrastructure means, some of the insured funds have a cash value and can be taken back, this includes certain types of insurance such as whole life or endowment, there is a type of insurance product that accidentally combined with investment, called unitlink.


Better Cost and Benefit Allocation

The greater the risk of losses that arise, the greater the premium coverage of the insurer policyholders.


Giving Level of Certainty

It is a major benefit of insurance because they are essentially trying to reduce the uncertain consequences of an adverse, predictable condition so that the cost of such losses becomes definite or relatively more certain.


Helps Increase Business Insured Productivity

The insured will invest in a particular business field (High Risk Business) if some of the investment risk can be covered by insurance to reduce the risk that may occur in the future.

Credit Guarantee

An insurance policy can be used as loan collateral, usually only for life insurance and highly selective for certain types of loans and banks.


Baca juga:

Prinsip Dasar Asuransi

Pengertian Asuransi

Jenis Resiko yang Dapat Diasuransikan

Merencanakan Program Asuransi

Istilah Dalam Asuransi


Bagikan ke teman anda

Types of Insurable Risks


Not all risks can be insured.

Insurable risk must meet the following characteristics:

Losses are definitive (definitive)

such as: death, sickness, disability, and old age, including identifiable conditions, such as destroyed buildings, submerged ships, fallen planes, and others

Losses occur due to accidental factors

such as: suffering from late stage critical illness, accident, or natural disaster

Loss are convincing

such as: someone who can no longer work because of a work accident, the machine does not work anymore because it is severely damaged

Objects insured can be assessed and converted to the value of money

The risk should be natural

occurred by accident and not planned beforehand

The risks that occur do not violate the public interest

Insurance premiums charged are fair

The insurer must have an insurable interest

Baca juga:

Prinsip Dasar Asuransi

Fungsi dan Tujuan Ber-Asuransi

Pengertian Asuransi

Merencanakan Program Asuransi

Istilah Dalam Asuransi


Bagikan ke teman anda

Term In Insurance


The term often used in Insurance, among others:

Insurance policy

Letter of Agreement containing the insurance agreement between the Insurer and the Policyholder.


The person who applied for an insurance. If the insurance has been approved then the applicant will become the Policyholder.

Policy Holder (Policy Owner)

Insurance policy holder.


Someone who becomes the object of insured or insured.


Persons or composed of several persons designated to receive insurance benefits or sum insured


A sum of money that is borne by the Insured and listed in the policy and has been approved to be paid to the Insurer as agreed.

Sum insured

The value of money stated in the insurance policy to be paid by the insurer to the Holder.

Cash value

A sum of money listed on the policy to be paid to the Policyholder if the policy is canceled before the end of the insurance period or when the insured dies.

Insurable Interest

The relationship between the insured and the object insured by the company, concerning the things that have great potential to cause harm that can cause financial loss for the Insured.


Baca juga:

Prinsip Dasar Asuransi

Fungsi dan Tujuan Ber-Asuransi

Jenis Resiko yang Dapat Diasuransikan

Merencanakan Program Asuransi

Pengertian Asuransi


Bagikan ke teman anda