Insurance

Unit III

Importance of Insurance

The process of insurance has been evolved to safeguard the

interests of people from uncertainty by providing certainty of

payment at a given contingency. The insurance principle

comes to be more and more used and useful in modern

affairs

Importance Cont.

(i) Uses to individual,

(ii) Uses to a special group of individuals, viz., to business or

industry, and

(iii) Uses to the society.

1. Uses to an individual :

a. Insurance provides Security and Safety

b. Insurance affords Peace of Mind

c. Insurance protects Mortgaged Property

d. Insurance eliminates dependency

e. Life Insurance encourages saving

f. Life Insurance provides profitable Investment

g. Life Insurance fulfils the needs of a person (Family, Old

age, Readjustment, Special)

2. Uses to business

Uncertainty of business losses is reduced

Business-efficiency is increased with insurance

Key Man Indemnification

Enhancement of Credit

Business Continuation

Welfare of Employees

3. Uses of society

Wealth of the society is protected

Economic Growth of the Country

Reduction in Inflation

Crop insurance or Agricultural

insurance

Life Insurance