Scribd
Upload
69 views13 pages

Insurance and It'S Importance: SANHITH REDDY (191127) Sec.A

Insurance is a contract where one party agrees to pay a specified amount to another party if certain events occur, such as death, injury, damage or financial loss. It allows individuals to pool their risks, making payments more affordable. There are two parties in insurance - the insurer, who provides coverage, and the insured, whose interests are protected by the policy. Insurance is important as it provides protection against uncertain events, facilitates risk sharing, and offers financial support in difficult situations. It works by the insured paying premiums to the insurer in exchange for compensation if a covered event occurs, establishing peace of mind. Common types of insurance include life, health, home, auto and business insurance.

Uploaded by

sanhith
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
69 views13 pages

Insurance and It'S Importance: SANHITH REDDY (191127) Sec.A

Insurance is a contract where one party agrees to pay a specified amount to another party if certain events occur, such as death, injury, damage or financial loss. It allows individuals to pool their risks, making payments more affordable. There are two parties in insurance - the insurer, who provides coverage, and the insured, whose interests are protected by the policy. Insurance is important as it provides protection against uncertain events, facilitates risk sharing, and offers financial support in difficult situations. It works by the insured paying premiums to the insurer in exchange for compensation if a covered event occurs, establishing peace of mind. Common types of insurance include life, health, home, auto and business insurance.

Uploaded by

sanhith
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 13

INSURANCE AND IT`S

IMPORTANCE
SANHITH REDDY (191127)
SEC.A
DEFINITION’S

 A Contract in which an individual or entity


receives financial protection or reimbursement
against losses from a company. The company pool
client`s risk to make payments more affordable for
the insured.
 Insurance is an instrument of distributing the loss
of few among many.
 Insurance is cooperative form of distributing a
certain risk over a group of persons who are
exposed to it.
 According to the Insurance Act 1938 Insurance means,
Insurance as a form of contract agreement under which one
party agrees in return for a consideration to pay an agreed amount of money to
another party to make a good loss, damage or injury to something of value in which
the insured has an interest as a result of some uncertain event.
 There are two parties in insurance. They are
a).Insurer.
b).Insured.
 Regulated and controlled by (IRDA) Insurance Regulatory and Development
Authority
 INSURER:
An “insurer” refers to the company providing you
with financial coverage in the case of unexpected, bad
events covered on your renters or homeowner's policy.
 INSURED:
A Person whose interests are protected by
an insurance  policy; a person who contracts for
an insurance  policy that indemnifies him against loss
of property or life or health etc.
IMPORTANCE

Provides
Device for Co-operative
protection against Facilities of
eliminating risks method of
occurrence of international trade.
and sharing losses. spreading risks.
uncertain events.

Source of
Financial support. Medical support.
employment.
CHARACTERISTICS:

Sharing of Co-operative
Value of risk
insurance Device

Payment of Large number of Amount of


contingency insured persons payment
HOW IT WORKS:

Comprises of insured , insurer and agent.

Insurance starts from proposal and ends with the benefits.

Based on principle of ‘’At most good faith’’ contract is made.

Establishes “Peace of mind’’ of insured.

The insured gets appropriate compensation being in the boundary


of terms.
CLASSIFICATIONS

 ON THE BASIS OF NATURE OF BUSINESS:


a). Life insurance
b). Fire insurance
c). Social insurance
d). Marine insurance
 FROM BUSINESS POINT OF VIEW
a). Life insurance
b). General insurance
 FROM RISK POINT OF VIEW
a). Personal insurance
b). Proprietary insurance
c). Liability insurance
d). Fidelity guarantee insurance
LIFE INSURANCE:
 Life insurance is a contract that offers financial
compensation in case of death or disability. Some life
insurance policies even offer financial compensation after
retirement or a certain period. Life insurance, thus, helps
you secure your family’s financial security even in your
absence. You either make a lump-sum payment while
purchasing a life insurance policy or make periodic
payments to the insurer. These are known as premiums. In
exchange, your insurer promises to pay an assured sum to
your family in the event of death, disability or at a set time.
 This includes Term policy, Money back policy, Unit
linked insurance plan, Pension plan.
GENERAL INSURANCE:
 A general insurance is a contract that offers financial compensation on any loss other
than death. It insures everything apart from life. A general insurance compensates you
for financial loss due to liabilities related to your house, car, bike, health, travel, etc.
 Simply put, a general insurance offers financial protection for all your assets against
loss, damage, theft, and other liabilities. It is different from life insurance.
 General insurance includes
a).Health insurance b).motor insurance
c). Travel insurance d).home insurance
e). Fire insurance f). Marine insurance
PRINCIPLES
Principle of insurable interest OF
Principle
Principle
Principle
of utmost
of
mitigation
ofcontribution
subrogation
indemnity
goodoffaith
loss
INSURANCE

You might also like