Concept of risk management, concept of insurance, importance of insurance, essentials of insurance, principles of insurance. Types of insurance
Risk management is the process of analyzing exposure to risk and determining how to best handle such exposure. The risk management process undertakes a best practices approach and focuses on understanding the key risks and managing them within acceptable levels. Insurance can be defined as the act of providing indemnity or coverage against harm, as the contract which spells out the terms of coverage, or as the actual coverage itself.
Insurance contributes a lot to the general economic growth of the society by provides stability to the functioning of the process. The insurance industries develop financial institutions and reduce uncertainties by improving financial resources.
The insurance policy is a contract between the insurer and the insured, known as the policyholder, which determines the claims which the insurer is legally required to pay. It is the promises of a sum of money in event of loss, eg.: by fire or another disaster, given in compensation by a company, etc. in return for regular payments.
Fire insurance is an agreement between two parties, i.e., insurer and insured, whereby the insurer undertakes to indemnify the loss suffered by the insured in consideration for his paying off certain sum called ‘Premium’. Fire insurance is an insurance policy purchased in order to cover any damage to property caused by a fire. It is a specialized form of insurance beyond regular property insurance, which is designed to cover the cost of replacement or repairment, the basic property insurance policy.
Marine Insurance is the insurance against loss by damage or destruction of cargo, freight, merchandise, or the means or instruments of transportation and communication whether on land, sea, or air. It is a safe haven for shipping corporations and transporters because it helps to reduce the aspect of financial loss due to the loss of important cargo. Marine insurance ensures the coverage of all types of risks which occur during the transit.
Marine insurance is a safe haven for shipping corporations and transporters because it helps to reduce the aspect of financial loss due to the loss of important cargo. There are also various types of marine insurance policies that are offered to the clients by insurance companies so as to provide the clients with flexibility while choosing a marine insurance policy. Depending on the nature and scope of a client’s business, the owner can make the best marine insurance plan and enjoy the advantage of having marine insurance.