y What is insurance? y What is the history of insurance? y What is the need of insurance?

y What are the objectives of insurance? y How it works? y How many types of insurance are there?

What is Insurance?
It is a contract or agreement between two parties by which one of them (called insurer) agree to indemnify the other (called insured) against a lost which may occur to the insured on the happening some event.

What are the objectives of insurance?
The major and the basic objective of insurance is to protect you from the uncertain and unexpected loss and provide you a status to bear that loss in much better way.

To whom the benefit will be paid
Accumulated cash value along with applicable benefit will be paid to the person nominated by the policyholder.

3. Principle of utmost good faith
N1

y The insured and the insurer are bound by a good faith, honesty and fairness.

y For examples if the loss occurs, they will check the facts and if in-accurate details have been given they will not pay damages to incurred.

Slide 5 N1 utmost: supreme; highest, greatest, most; extreme; farthest
Neeo, 6/2/2010

There are major two types of insurance:
1) 
   

Life insurance:
Own life. Family/Household insurance Group insurance. Medical insurance Disability insurance

2) 
  

General insurance:
Automobile & truck Insurance Marine insurance. Travel insurance Property insurance etc.

Main difference b/w life insurance & general insurance:
‡ Life is very long-term in nature ² life insurance can cover risks over many decades. ‡ General insurance cover usually a shorter period, such as one year.

(b) Whole Life Insurance
‡ This type of policy never expires. ‡ As long as premiums are paid, it remains in force. ‡ Premiums are usually based on your age. ‡ You'll pay the same amount of premium for the rest of your life. (Start young and the less expensive the premiums will be)

General insurance
It provides protection against risks to property. It include specialized forms of insurance such as: ‡ Home insurance. ‡ Automobile insurance ‡ Marine insurance ‡ Travel insurance etc.

(II) Automobile insurance
‡ ‡ ‡ ‡ Motor insurance is determined by: Your living place. Type of vehicle. Your job. Age. Young drivers pay high premiums because statistics show that they¶re involved in more crashes than older drivers.