Insurance Full Details Benefit , Features and more about Insurance

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Insurance Full Details Benefit , Features and more about Insurance


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Insurance Full Details Benefit , Features and more about Insurance



Insurance is the means by which the risk of loss can be passed on to the other party (insurer or insurer) by paying some fee (called premium). The party whose risk is put on the insured is called 'Insured'. An insurer is usually a company that is willing to share the loss or damage of the insured and is able to do so.

Insurance is a type of contract. An agreement that is legally enforceable in two or more persons is called a contract. An insurance contract broadly means that the insurer provides a certain sum of money to the insured person in the event of the event described in the insurance policy. The insurer who pays the occasional interest (insurer, premium) to the insurer is redeemable by this contract. The word 'insurance' comes from Persian whose meaning is 'to take responsibility'. Dr. Raghuveer has translated it as 'Agop'. Its English synonym is "Insurance".

Insurance is actually a contract between the insurer and the insured in which the insurer pays a certain sum of money in lieu of a certain event (such as in the event of a certain age expiration or death) in lieu of a certain sum (premium) from the insured or Compensates the actual loss from the insured's risk.

Thinking about the basis of insurance suggests that insurance is a form of cooperation in which all insured people, who may be at risk, pay premiums, while only a few (very few) of them, who actually Losses are compensated. In fact, the risk factor is higher but only a few of them are harmed in a given period. The insurer (company) acts to distribute the losses of the insured parties to the remaining insured parties.



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Features and nature of insurance


1. Risk protection - Insurance is a strong measure of risk. Relieves a person from all the uncertainties in life. These risks may be related to life, health, rights and financial resources, assets. Therefore, insurance is the only way to protect against all these risks.
2. The way to spread the risks - In insurance, work is done "for all and for all", based on the spirit of cooperation. A fund is created by collecting individuals surrounded by similar types of risks so that a person's risk is divided among all members and when a risk arises to a single member, payment is made from that fund to that particular member.
3. Transfer of risk from the insured to the insurer - The risks of all the insured in the insurance are transferred to the insurer. The insurer makes a fixed payment to the insured upon loss.
4. Insurance is a process - Insurance is also a process which is conducted in a predetermined manner. The insured first transfers his risk to the insurer in exchange for a fixed premium, then the insurance duty provides protection against that risk.
5. Insurance - A contract - It is a legal contract due to the validity of the validity of insurance. In this, the insured makes an offer to the insurer and the insurer agrees, but a valid contract is formed between the two in exchange for a fixed return (premium). In which, in the event of a certain event, the insurer pledges to compensate for its loss.
6. Insurance is the cooperative way - Insurance is based on the spirit of cooperative. Individuals with the same type of risk contribute to a certain fund, any member of which is paid from that fund when the risk arises. In this way, the spirit of "one for all and one for all" is acted upon.
7. Determining Losses' Risks - Risks cannot be eliminated in insurance, but the uncertainty of risks must be minimized and fixed. The insured transfers the risks to the insurance company and the value of that risk is determined by a fixed return / premium. That is, the uncertain losses in lieu of fixed premiums are fixed as the sum assured by the insurance company. This amount is called the insurance claim amount.
8. Payment only after the occurrence of the event - In insurance, payment is made only after the occurrence of the incident. In life insurance, the occurrence of an event is certain, such as death of the person, suffering from a particular disease, completion of the insurance period, then in such a situation the insured is paid. But in normal beams, payment will be made only after the occurrence of the event, otherwise the insured will not be held responsible for payment.
9. Assessment and assessment of risk - In insurance, risk assessment is done before the insurance contract. The premium is pre-determined based on the amount of risk and the probability of risk arising. A fixed sum assured is paid when a certain risk arises against this fixed return / premium.
10. Basis of payment - In life insurance, the investment element is contained, so on the death or completion of the term, a certain amount is paid to the insured. But other insurance will be paid equal to the actual loss. According to the contract, if the risk arises due to the insured and will be paid only within the limit of the sum insured, no more payment is made.
11. Broad Area - The area of ​​insurance has now become very wide. Earlier only life insurance, marine insurance and fire insurance were insured but now along with traditional risks, non-traditional risks are also insured. Now the field of diversified insurance has become very wide. In this, various types of beams have been included in theft insurance, accident insurance, livestock insurance, crop insurance etc.
12. Institutional Framework - Major institutions are engaged in insurance work all over the world. In India, the Life Insurance Corporation, General Insurance Corporation and its four subsidiaries and many private companies are engaged in insurance work.
13. Insurance is not gambling - Compensation is equal to the actual loss in insurance or compensation only when there is normal loss, so it is wrong to compare insurance with gambling. In gambling, one party remains in profit, the other party remains in our loss, but in insurance it is not so.
14. Insurance is a charity, not a right - In insurance, the right is obtained by contributing to the insured, on the basis of contractual relationship, the insurer pays the insurance money / claim after a fixed period of time to the insured in lieu of a fixed return (premium).
15. Measures to address social problems - Many social problems prevailing in the society are prevented by insurance as insurance reduces the uncertainties and risks of the society.
16. Insurance law compulsory - In the modern era, the field of insurance is expanding and with this it is the duty of governments to enact regulatory act related to insurance. Acts have also been made in India for life insurance, marine insurance, general insurance. Apart from this, the Insurance Control and Development Authority regulates and controls the entire insurance business.

17. Essentials of Insurance Principles - It is mandatory to have some principles for insurance contract. Insurable interest in these