OF INSURANCE JARGON

Insurance being a technical occupation by virtue of the basic contracts created between Insurer and the Insured has a wealth of technical terms that the ordinary person/ 'person on the Clapham omnibus' would term as confusing and unnecessary 'jargon', brought about to confuse the insured and used to repudiate (oops! that's another one! turn down/disown/decline) insurance claims.

As an asides but in fact the EU and the UK in particular have recognised the technical nature and uniqueness of the insurance contract by exempting Insurance contracts from The UNFAIR CONTRACT TERMS ACT of 1977 and having a separate and distinct section under FINANCIAL SERVICES AUTHORITY as empowered by the FSMA 2002 which mentions the ICOB (Insurance Conduct of Business) as the regulatory domain of Insurers.

I happen to be on both sides of the rail here (Insurer and Insured) and not to take it on the chin as as an Insurer would want to explain two terms that have come to mind being 'VIS MAJOR' famously known as 'ACTS of GOD' and the term 'THIRD PARTY'.

ACTS of GOD/'Vis major'

From a layman's point of view, this has been promulgated by the masses (unfortunately from an uninformed point of view) as being an excuse by Insurers to repudiate claims by inserting it in their policies as an exception. Actually the confusion comes from the 20th Century tort of Negligence which is insurable but within its legal context has a number of defences such as 'vis major', whereby a claimant can not claim from the 'alleged tortfeasor' on injury, damage or loss that they have suffered as a result of an unforeseeable natural occurrence not within the control of the alleged tortfeasor.

Insurers cover sudden, unforeseeable and unintended losses but on some policies, a case in point being the Sub-Saharan Africa Fire named peril policy exclude perils like Earthquake, Tsunami, Bushfire (ha ha ha!) etceteras for one reason or another but mostly for historical purposes (such as adopted policy wordings left behind by original insurers from the UK that specifically excluded these items), in practice whilst most of these items are not originally included in the Fire 'named peril' policy they can be included on a 'buy-back' basis (on payment of additional premium) to make the cover applicable more comprehensive, that is you can add 'earthquake', 'riot and strike', 'malicious damage', 'sprinkler damage', etceteras cover to your basic Fire insurance cover.

The key is to use knowledgeable insurers and intermediaries (brokers), knowledge in insurance is not by virtue of company registration or to be judged by the quality of a suit the insurer/broker is wearing, it is by acquired knowledge by examination and experience, so to protect our hard earned property/assets it is recommended and advisable to used qualified insurers/brokers who would advise expertly prior to cover inception, during the cover period and when a loss has occurred. Using professionals also entitles the layman with the legal capacity and tool to sue the so called expert for Professional Negligence (breach of duty of care- Negligence Tort) if they advise you erroneously or omit to advise you effectively and you on reliance of their professional advice and as a direct consequence thereof suffer a loss which can be measured in financial terms.

THIRD PARTY

Why a third party? simple this one although not always obvious, the insurance contract has two parties; the Insured (1st Party) and the Insurer (2nd Party), the Insured may be more that one individual/firm but jointly insured therefore still one party.

The Insurance Contract is not to be confused with the tripartite relationship of the Insurer, the Intermediary and the Insured.

As far as the Insurance contract is concerned therefore, any party other than those legally privy to the contract that would want to benefit upon it or from it are a Third Party.