Insurance provides protection from financial loss by spreading risk across many individuals. It has several key functions:
1. Collective risk bearing - Insurance shares the costs of losses among policyholders by pooling their premium payments into a fund used to reimburse those who suffer specified risks.
2. Evaluating and pricing risk - Insurance assesses various risk factors to determine the likelihood of losses and set premium rates accordingly.
3. Providing certainty - Insurance transforms uncertainty about potential losses into a known payment of premiums in exchange for coverage if a loss occurs.
this ppt is about the financial services .whats the financial services, types of financial services,functions of financial services,importance of financial services,features of financial services,Indian financial system as well as international financial management.
One of the oldest forms of business financing, factoring is the cash-management tool of choice for many companies. Factoring is very common in certain industries, such as the clothing industry, where long receivables are part of the business cycle.
this ppt is about the financial services .whats the financial services, types of financial services,functions of financial services,importance of financial services,features of financial services,Indian financial system as well as international financial management.
One of the oldest forms of business financing, factoring is the cash-management tool of choice for many companies. Factoring is very common in certain industries, such as the clothing industry, where long receivables are part of the business cycle.
Understanding Insurance for Protecting Your Future.pdfinsurekar
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PRESENTATION ON “ STUDY OF SALES PROMOTION’’ AND “ANALYSIS OF INSURANCE B...Muthoot finance Ltd
Meaning of INSURANCE ,Indian Insurance Industry Overview Types of Insurance ,Examples of INSURANCE Company ,How does insurance work?, tax benefits on insurance
Insurance is a means of protection from financial loss. It is a form of risk management primarily used to against the risk of a contingent, uncertain loss.
2. WHAT IS INSURANCE?
The definition of insurance can be made from
two points:
Functional definition.
Contractual definition.
FUNCTIONAL DEFINITION
Insurance is a co-operative device to spread the
loss caused by a particular risk over a number of
persons who are exposed to it and who agree to
insure themselves against the risk.
3. Contractual Definition
In the words of Justice Tindall, “Insurance is a
contract in which a sum of money is paid to the
assured as consideration of insurer’s incurring
the risk of paying a large sum upon a given
contingency.”
5. PRIMARY FUNCTIONS OF
INSURANCE
Providing protection – The elementary purpose of insurance is to allow
security against future risk, accidents and uncertainty. Insurance cannot
arrest the risk from taking place, but can for sure allow for the losses arising
with the risk. Insurance is in reality a protective cover against economic loss,
by apportioning the risk with others.
Collective risk bearing – Insurance is an instrument to share the financial
loss. It is a medium through which few losses are divided among larger
number of people. All the insured add the premiums towards a fund and out
of which the persons facing a specific risk is paid.
Evaluating risk – Insurance fixes the likely volume of risk by assessing
diverse factors that give rise to risk. Risk is the basis for ascertaining the
premium rate as well.
Provide Certainty – Insurance is a device, which assists in changing
uncertainty to certainty. 5
6. SECONDARY FUNCTIONS OF
INSURANCE
Preventing losses – Insurance warns individuals and
businessmen to embrace appropriate device to prevent
unfortunate aftermaths of risk by observing safety
instructions; installation of automatic sparkler or alarm
systems, etc.
Covering larger risks with small capital – Insurance
assuages the businessmen from security investments.
This is done by paying small amount of premium against
larger risks and dubiety.
Helps in the development of larger industries –
Insurance provides an opportunity to develop to those
larger industries which have more risks in their setting
up.
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7. OTHER FUNCTIONS OF
INSURANCE
Is a savings and investment tool – Insurance is the best savings
and investment option, restricting unnecessary expenses by the
insured. Also to take the benefit of income tax exemptions, people
take up insurance as a good investment option.
Medium of earning foreign exchange – Being an international
business, any country can earn foreign exchange by way of issue of
marine insurance policies and a different other ways.
Risk Free trade – Insurance boosts exports insurance, making
foreign trade risk free with the help of different types of policies
under marine insurance cover.
Insurance provides indemnity, or reimbursement, in the
event of an unanticipated loss or disaster. There are different types
of insurance policies under the sun cover almost anything that one
might think of. There are loads of companies who are providing
such customized insurance policies.
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10. CURRENT SCENARIO
•Growing at the rate of 15-20% annually
•75% population has no insurance
• Adds 7% to country’s GDP
•LIC market share come down to 75% and private insurers
increased over 24%
•Annuity or pension product have over 33% of market
•Unity linked insurance scheme have monopoly