INSURANCE AND RISK MANAGEMENT

By Swati Mittal

INSURANCE AND RISK MANAGEMENT

Insurance is the contract in which one party agrees to compensate another party for losses.
Insurance is a policy from a large financial institution that offers a person, company, or the other entity reimbursementor the financial protection against future losses or damages.

INSURANCE

PROBABILITY OR THREAT OF A DAMAGE, INJURY, LIABILITY, LOSS, OR OTHER NEGATIVE OCCURRENCE, CAUSED BY EXTERNAL OR INTERNAL CAUSES, WHICH CAN BE CURED THROUGH PREMEDICATED ACTION.

INTRODUCING RISK

ELABORATIONUncertainity Unfavourable Doubt Chance The greater the number of different outcomes that may occur, the grater the risk.

1. 2. 3. 4.

INTRODUCING RISK

LOSSbeing without something previously possessed.

Loss also refers to the act or instance of losing the detriment or a disadvantage resulting from losing.

RELATED WORDS

EXAMPLES1. Loss of memory 2. Loss of time 3. Loss of money 4. Loss of life 5. Loss of energy

LOSS

A FRACTION OR THE RELATIVE FREQUENCY OF LOSS. IN INSURANCE IT MEANS THE PROBABILITY OF LOSS.
TWO ASPECTS OBJECTIVE & SUBJECTIVE

CHANCE OF LOSS

THE CAUSE OF LOSS OR THE CONTINGENCY THAT MAY CAUSE A LOSS. WHICH INCLUDES RISK
IMMINENT DANGER SPECULATIVENESS

PERILS

IT IS THE POTENTIOAL TO CAUSE THE RISK WHICH IS LIKELY TO HARM.

DANGEROUS EVENT WHICH MAY LEAD TO AN EMERGENCY OR DISASTER

HAZARDS

TYPES OF HAZARDS-

PHYSICAL HAZARDS MORALE HAZARDS

MORAL HAZARDS

TYPES OF HAZARDS

(a) (b) (c) (d) (e)

Financial & Non Financial risk Static & Dynamic Risk Acceptable & unacceptable risk

Fundamental & Particular risk

Pure & Speculative risk

CLASSIFICATION RISK

PERSONAL RISK

PROPERTY RISK

TYPES OF PURE RISK

MORE RISK.
INTENSITY OF RISK MEASUREMENT OF RISK

DEGREE OF RISK