2. INTRODUCTION
Submitted To. Ma’am Sidra Gulam Rasool
Submitted By. Group A
Course Title principles of risk management and insurance
Course code COM-504
Presentation Topic. Lec No 2
GCWUF
3. INTRODUCTION OF GROUP A
Name. Roll #
Ayesha Khalid. 07 (Slide# 5,6,7,8,9)
Sadia Shahid. 09 ( Slide#
10,11,12,13,14)
Umaima Iftikhar. 10 (Slide#
15,16,17,18,19)
Ghazia Rubab. 02 (Slide# 20,21,22,23,24)
5. DEFINITION OF INSURANCE
Insurance is a means of protection from financial loss. It is
a form of risk management primarily used to hedge
against the risk of a contingent uncertain loss.
19. INDEMNIFICATION OF LOSS
Indemnification is an agreement where your insurer helps cover
loss, damage or liability incurred from a covered event. Indemnity
is another way of saying your insurer pays for a loss, so you don’t
have financial damages.
For example: in an insurance contract, one party agrees to pay the
other party for losses or damages in return for a premium payment
that is paid to the insurer.
20. REDUCTION OF WORRY AND FEAR
If a person has any coverage one of the benefit of insurance is that
worry and fear are reduced.
For example:
If family head has life insurance coverage those who are financially
dependent are less likely to worry about the financial security in the
event of premature death.
Owners of auto insurance policy or any other type of property insurance
enjoy greater peace of mind because they know they are covered if a
loss occus.
21. SOURCE OF INVESTMENT FUNDS
The insurance industry is an important source of funds for capital
investment and accumulation.
Example:
Premium are collected in advance of the loss, and funds net
needed to pay immediate losses and expense can be located, to
business firms.
Funds typically are invested in shopping centers, hospitals,
factories, housing developments, and new machinery and
equipment.
22. LOSS PREVENTION
Insurance companies are actively involved in numerous loss prevention activities and also
employ a wide variety of loss-prevention personnel, including, safety engineers and specialists
in five prevention, occupational safety and health, and products liability.
Examples of loss prevention activities that property and casualty insurers strongly support:
Highway safety and reduction of automobile deaths.
Fire prevention
Prevention of auto thefts
Prevention of defection products that could injure the user.
Society benefits because both types of direct and indirect loses are reduced by loss
prevention activities.
23. ENHANCEMENT OF CREDIT
Insurance makes a borrower a better credit risk because it guarantees the
values of the borrowers collected or gives greater assurance that the loan will
be paid.
Example:
When a house is purchased the lending institution require property insurance
on the house before the mortgage is granted. The property insurance protects
the lenders financial interest if the property is damaged or destroyed.
