Meaning:y The meaning of insurance is to protect one against

losses he cannot afford

y This is done by transferring the risk of a person ,

business or organization known as the insured to an insurance company, known as insurer

y The insurer then reimburses the insured for covered

losses

y The insured pays amount of money, called premium

to the insurer to transfer the risk

y The Insurer pools all the premium into large funds y When a policy holder has met loss, the insurer draws

fund from the pool and pays for the loss

Principles of Insurance:1) Proximate cause:- It is the main cause which brings

about a loss with no other intervening cause which breaks the chain of events cause poxima 2) Insurable Interest:- To insure anything the the insured must have an insurable interest in the subject matter of the insurance. 3) Contribution:-Although the insured may effect more than one policy to cover the same property or interest

4) Indemnity:- It is the placing of insured in the same financial position after a loss as he was before the loss 5) Utmost Good Faith:- It is the duty to disclose all the material fact relating to the risk to be covered 6) Subrogation- stepping into shoes:- It is the right of the insurance company who has paid a claim to the client to pursue other party who may have caused the incident resulting into claim

Roles of Insurance
The Underwriter:- he is employed by the insurance companies to assess the risk and dictate the terms of the policy, including premium. 2) The Surveyor:- The surveyor is contracted by the insurer to act as an intermediary between the insurance company and the policy holder over claims. 3) The Broker:- The Broker is independent intermediary , who uses his knowledge and experience to assess the client s risk and find appropriate policies.
1)

4) The Claims Advisor:- They are members of an insurance companies claims department , they are first part of the call when a claim comes in. 5) The Actuary:- They provide the formula which is used to calculate the premiums and surrender values. 6) The Financial advisor:- Most companies offers investments oppurtunities to clients, such as endowments and life assurance. Job oppurtunities exist in sales, consultancy or investment analysis.

Types of Insurance:1) Life insurance:- Life insurance or life assurance is a

contract between the policy owner and the insurer, where the insurer agrees to pay a designated beneficiary a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount at regular intervals or in lump sums . It may be a) Normal life insurance b) Health insurance

2) General insurance:- Insurance other than Life Insurance falls under the category of General Insurance. General Insurance comprises of insurance of property against fire, burglary etc, personal insurance such as Accident Insurance, and liability insurance which covers legal liabilities. There are also other covers such as Errors and Omissions insurance for professionals, credit insurance etc. 3) Agricultural insurance:- The National Agricultural Insurance Scheme in India was introduced in 1999-2000 season. The Ministry of Agriculture in India implemented it. The scheme aims at protecting the farmers against losses incurred by the farmers due to crop failure because of natural calamities (drought, flood hailstorm, cyclone).

4) Bancassurance:- Bancassurance simply means selling of insurance products by banks. In this arrangement, insurance companies and banks undergo a tie-up, thereby allowing banks to sell the insurance products to its customers. This is a system in which a bank has a corporate agency with one insurance company to sell its products. 5) Re-insurance:-Reinsurance is insurance that is purchased by an insurance company (reinsurer) from an insurer as a means of risk management, to transfer risk from the insurer to the reinsurer.

6) Group Insurance:-Group insurance offers life insurance protection under group policies to various groups such as employers-employees, professional, cooperatives, weaker sections of the society.
y 7)Micro Insurance:-Micro insurance is a term

increasingly used to refer to insurance characterized by low premium and low caps or low coverage limits, sold as part of atypical risk-pooling and marketing arrangements, and designed to service low-income people and businesses not served by typical social or commercial insurance schemes.

Types of Policies:1) Endowment Policy :- An endowment policy covers risk for a specified period , at the end of which the sum assured is paid back to the policy holder , along with bonus accumulated during the term of the policy. 2) Whole life Policy:- A typical whole life policy runs as long as policy holder is alive. The risk is covered for the entire life of policy holder hence such policy is called as whole life policy. The whole life policy sum assured is only payable to nominees of beneficiary upon death of policy holder. The policy holder is not entitled to any money during his or her lifetime i.e there is no survival benefit

3) Term life Policies:- Term life policies cover risk only during the selected time period. If the policy holder covers the term, the risk comes to an end. A term plan is designed to meet the needs of the people who are initially unable to pay the larger premium required for a Whole life or Endowment assurance policy. 4) Money-back Policies:- In this policies , the survival benefits are payable partial during the term of the policy as long as the policyholder is alive. At the time of death the whole sum assured is given without deduction of any survival benefit amounts which are paid back

5) Joint life Policies:- Joint life policies are same as endowment policies but categorized separately as they cover two lives simultaneously. It thus gives them a unique advantage in case of married couples or partners in a business firm. 6) Children s insurance Policies:- Children s insurance plan include those which parents or guardians can provide life insurance to their child from birth. The risk cover commences from the child attaining the age of 12/17/18/21 known as the date of risk.

7) Pension plans:- It is an investment one makes , through installments paid over a certain number of years , in return he receives a specific sum every year, every month or half a year for the life or for fixed no of years 8) Women s policy:- Women s policy provides funds for women in times of need like education, marriage, sickness with guaranteed and loyalty additions during the policy term period and after the maturity

Regulatory Framework in india:y The IRDA Act' 1999, Insurance Regulatory and Development Authority was enacted to regulate, pomote and ensure orderly growth of the insurance industry.

The Authority is a ten member team consisting of (a) a Chairman; (b) five whole-time members; (c) four part-time members, (all appointed by the Government of India)

Claims:y Insurance claims are the requests of the insured

policyholder to the insurer or insurance issuing company for financial reimbursement whenever s/he suffers a loss related to the insured property, life, auto or health.
y The insurance claim should be done in accordance

with the specifications of the insurance policy or contract.

y Insurance claims vary from person to person and from

policy to policy. y The maximum amount of redemption in case of an insurance claim depends on the scheme under which a person has enrolled and the regular premium amount s/he is paying. y At the time of repayment of the claim to the policyholder, the insurance company is only giving back the premium amount, either in entire or in part.

Thank You