Insurance distributes the cost of unexpected losses by having an insurer and insured share the risk. The Pakistan Insurance Act of 1952 established rules and regulations for insurance businesses covering various fields of life and general insurance. However, insurance in Pakistan has faced serious problems and failed to gain high performance compared to developed countries due to issues like poverty, illiteracy, and lack of insurance awareness and economic development. Insurance is classified into life insurance, which provides security against events like death or marriage, and non-life insurance, which covers risks from events excluding death like fire, marine accidents, motor accidents, and more.

1. 1
INTRODUCTION TO INSURANCE
Definition:-
• Insurance is a financial arrangement which distributes the cost of
unexpected losses.
• Insurance is important to protect to serve and to minimize the
risks.
• For e.g.: wind storm, float, person can die, earthquakes etc…
• Insurer (company) and Insured (person)
INSURANCE IN PAKISTAN
Pakistan Insurance Act 1952:-
• This act is regarding the insurance business.
• This act covers rules regulations, losses in business in various
fields of life and general insurances.
FAILURE OF INSURANCE IN PAKISTAN
• The importance of Insurance in economy of Pakistan is universally
felt it is unfortunate that Pakistan had faced serious problems in
the field of insurance.
• Difficulties started very fast within a limited resource and in a
little period of time. Pakistan had been able to make a
development in business but it has not gained high level
performance in the field of insurance compared with the other
developed countries of the world.
Major Problems of Failure of Insurance
• Poverty
• Illiteracy
• Lack of insurance minded persons
• Lack of economic development

2. 2
CLASSIFICATION OF INSURANCE
(1) LIFE INSURANCE
(2)NON-LIFE INSURANCE
(1) LIFE INSURANCE:-
Life insurance is an insurance guarantee to provide security or
protection against possible hurt, damage, loss or liability Marriage
assurance or birth assurance. Assurance linked to capitalization
contract
(2)NON-LIFE INSURANCE:-
Non-life insurance is different from life insurance. I case of death,
sickness or personal accident, no amount of compensation can
equate the emotional disruption being experienced from the death
of a loved one through sickened or accident.
Fire, Marine, Motor, Agricultur Aviation Liability Consequential (Loss)
Fire Engineering