Chapter one

1,1 Introduction

Insurance is a contract whereby, for a stipulated consideration, one party undertakes to compensate the other for loss on a specified subject by specified perils. The party agreeing to make the compensation is usually called the insured or underwriter, the other , the insured or assured, the agreed consideration, the premium the written contract, a policy, the events insured against, risk or peril and the subject right, or interest to be protected, the insurable interest’. The insurer and the insured are the essential parties to a contract of insurance. However, an essential part is plated by the presence and necessity of the insurance fund. This insurance fund must be protected.