Insurance
n
Insurance
is a risk management plan. In case of any eventuality, such as an accident,
illness, or death, it provides protection against financial loss.
n
Loss
can be categorized across two categories, predictable and unpredictable.
Predictable loss cannot be insured whereas unpredictable loss can be insured.
Risk Sharing
n
Insurance
is about “risk sharing”. It helps us share our risk with a large number of
people.
For instance, in a group of hundred people the probability of three people who would get affected by health risk and claim benefits is one out of fifteen. The chances of this happening are high. On the other hand, the probability of six people who would claim benefits out of the same group is one out of two thousand one hundred and fifty. The chances of this happening are miniscule.
For instance, in a group of hundred people the probability of three people who would get affected by health risk and claim benefits is one out of fifteen. The chances of this happening are high. On the other hand, the probability of six people who would claim benefits out of the same group is one out of two thousand one hundred and fifty. The chances of this happening are miniscule.
n
To
avail insurance, you need to buy an insurance
policy and pay timely premium.
Under insurance, individuals and organizations are guaranteed compensation for
losses on payment of a premium, as specified in the insurance contract.
0 comments:
Post a Comment