What is Insurance?
What are the characteristics of insurable Risks?
What are the principles of insurance?
What is pooling of risk or risk pools?
What kind of insurances can be taken for individuals?
What kind of Insurances can be taken for Businesses?
What type of insurances can be taken for Government?
How long does it take for a policy to be issued?

What is Insurance? | top

The simplest way to define insurance is that insurance is the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a premium”
Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for a premium. Insurer, in economics, is the company that sells the insurance. Insurance rate is a factor used to determine the amount, called the premium, to be charged for a certain amount of insurance coverage. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice.

The benefits of insurance can be Peace of mind, loss control, Social benefits, Investment of funds, Invisible earnings.

What are the characteristics of insurable Risks? | top

• Fortuitous
• Financial Value
• Insurable Interest
• Homogeneous
• Pure Risks
• Particular Risks
• Public Policy

What are the principles of insurance? | top

• Utmost Good Faith
• Proximate Cause
• Indemnity
• Subrogation
• Contribution
• Insurable Interest

What is pooling of risk or risk pools? | top

A risk pool is one of the forms of risk management mostly practiced by insurance companies. Under this system, insurance companies come together to form a pool, which can provide protection to insurance companies against catastrophe risks such as floods, earthquakes etc. The term is also used to describe the pooling of similar risks that underlies the concept of insurance. While risk pooling is necessary for insurance to work, not all risks can be effectively pooled. In particular, it is difficult to pool dissimilar risks in a voluntary insurance market, unless there is a subsidy available to encourage participation.

The pool idea work because not everyone in the pool will have a loss but the premiums of all who contributed will be sufficient to pay any claims.

What kind of insurances can be taken for individuals? | top

• Home
• Private Motor
• Travel
• Personal Accident
• Health
• Pleasure Craft
• Life

What kind of Insurances can be taken for Businesses? | top

• Fire & Additional Perils
• Consequential Loss
• Public Liability
• Money
• Fidelity Guarantee
• Group Personal Accident
• Group Health
• Professional Indemnity
• Construction
• Engineering

What type of insurances can be taken for Government? | top

• Construction Projects
• Buildings & Other Assets
• Employees

How long does it take for a policy to be issued? | top

It depend on the type of Insurance taken, some polices take one hour, some a day and some even a week.