Insurance Contract under the Egyptian Civil Code

An insurance contract is a legal agreement between two parties: the insurer (the insurance company) and the insured (the policyholder). Under this agreement, the insurer undertakes to assume certain risks in return for a premium paid by the insured and commits to financially compensate the insured in the event of the occurrence of the insured risk or the fulfillment of a condition specified in the contract.

The essence of the insurance contract lies in transferring the burden of risk from one party to another in order to secure financial compensation for the insured upon the occurrence of a loss or damage resulting from such risk.

Definition of the Insurance Contract

Insurance is a contract whereby the insurer undertakes to pay to the insured, or to the beneficiary designated in whose favor the insurance was effected, a sum of money, a periodic income, or any other financial compensation in the event of the occurrence of the accident or realization of the risk specified in the contract, in consideration of a premium or any other financial payment paid by the insured to the insurer.

Types of Insurance Contracts

Personal Insurance (Insurance on Persons): Temporary (for a fixed more info period), whole-life (permanent), or mixed insurance combining life and death coverage.

Property Insurance (Insurance on Things): Covers material losses to assets such as homes, vehicles, and money. Examples include fire insurance, theft insurance, natural disaster insurance, crop damage insurance, and motor insurance (covering material damage).

Liability Insurance: Covers the insured’s obligation to compensate third parties for damages caused by the insured, such as employer’s liability, general liability, medical liability, professional liability, or product liability.