Insurance is based on certain principles which form the foundation of an insurance policy. These principles have evolved over the decades. While in several countries, some of them may be adopted after modifications, to provide for better service levels, most of the basic principles would generally still hold good. In many countries also, Insurance is slowly evolving into a financial instrument, especially for large businesses and it would remain to be seen as to how far this aspect can really be taken to.
The basic and general principles of insurance are:
* Contract
* Utmost Good Faith
* Insurable Interest
* Indemnity
* Subrogation
* Contribution
* Proximate Cause
* General Conditions