To Start this article is to define what is insurance. This term implies a specific kind of economic relations, which provides insurance protection for entities or individuals from dangers of all kinds. In this article, we will discuss the functions of insurance, its purposes and types.
As you know, any kind of economic relations carries with it certain risks, because there is always a possibility of losing their finances. So it is possible risk and included in the concept of “risk”.
From an economic point of view, risk can be called the future probability of events with negative results. It adverse outcome risk is expressed using damage. Many companies, organizations are trying at factors of risk to compensation in case if unfavourable conditions is still due.
We Can conclude that the essence of insurance is to create insurance funds that exist at the expense of contributions of participants of the insurance company. If there is an accident, the insurance Agency will pay a certain amount of money to the injured party.
The Insurance business, as a rule, does not create anything new. It exists due to the distribution of funds contributed by the participants of the insurance company.
First and foremost, the insurance performs a distribution function and pays financial compensation in case of adverse risk conditions. That is the distribution function ensures the process reliability at all stages of insurance.
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The Risk function is able to provide material protection against adverse random events that lead to material losses. Each party's insurance makes certain contributions that he would not return after the end of the current contract.
Insurance performs a preventive function. Its implementation is carried out by reducing the risk and bad consequences of any insured event. This function will be implemented through grant funds to prevention, control and containment of bad consequences of accidents, disasters or accidents. In order to be able to implement this feature, you need to create a special insurance Fund.
Insurance performs well as a savings feature. This suggests that the participants of the insurance Fund will be able to save the amount of endowment insurance. This kind of savings was caused by the need to protect already achieved the family wealth.
The Investment feature allows participants of insurance subject to availability of amounts and invest them into the Fund of an insurance organization and make profits due to the activities of the company.
The Insurance also performs credit function. We are talking about the recoverability of insurance premiums.
Control function is in the proper Fund and target use of incoming funds.
The Main purpose of insurance is to protect individuals, forming an insurance Fund. The more people were able to attract the company, the more capital it has. So, the purpose of insurance is the ability to meet the public demand for quality and reliable insurance protection from any kind of negative contingencies.
Considering the macroeconomic position of insurance, it also can be called the accumulation of funds that were paid by participants of the insurance Fund and investing these funds into the economy. Choose the right purpose of insurance and will be able to determine its effectiveness. To quantify, you can use the insurance coverage protection customers subject to risks as well as the insurance level for each of these risks.
The Purpose of compulsory insurance is to provide compensation for the harm that was caused during transportation to property and health of passengers. It doesn't matter what kind of transport and type of transport was used. In this case, created a uniform insurance conditions for all customers, as well as the condition of payment of funds to victims.
The Compulsory insurance exists on the principle of warranty damages received during transportation on any means of transport. All insurance payments are made at the expense of the insurance indemnity or compensation established by the law of the Russian Federation. The size of the caused damage and the method of its compensation is determined no matter what transport was used.
The Main objective of social insurance is to provide financial support for those categories of insured persons who, due to certain circumstances lost health.
Therefore, there exist social insurance:
The Purpose of mandatory social insurance determines the state. This is done to assist the disabled group.
There is a breakdown of expenditures for compulsory social insurance. This document need to be completed by persons wishing to obtain a social insurance from the state. If you belong to the disabled population, the state will help you.
This type of insurance is the main form of protection of the population in health protection.
Health insurance – is a combination of several types of insurance that provide full or partial payment to the insured persons for various medical services.
The Main purpose of health insurance is to guarantee the citizens eligible for medical assistance in cases of diseases due to the accumulated by the Fund.
Pension insurance – material security of citizens in retirement age. This insurance can be of two types: public and private.
The First of these is fully guaranteed by the state, and the procedure for obtaining passes full legal control, and the second may be concluded in a variety of ways, taking into account all the nuances.
The Purpose of pension insurance are guaranteeing elderly people a decent standard of living. Ideally, the difference in the receipt of funds in the working and retirement time should not be very noticeable.
Like any other industry, insurance has its own principles. So, it is very important equivalence principle, which should be to maintain balance between expenses and income of the insurance company. Of course, risks can threaten very many people but actually not all of them lead to the occurrence of the insurance event.
Insurance payment in each case will be carried out only through the contributions of other participants in the organization who were able to avoid the insured risk.
For insurance is inherent in the principle of randomness. This suggests that insured only those events that are characterized by signs of probability and randomness.
The Purpose and objectives of insurance imply the activity of the insurance organization. The main tasks will be mandatory the presence of some factors, namely:
For a correct implementation of all goals and objectives every insurance company is monitored by public authorities.
As mentioned above, the purpose of insurance is to protect individuals participating in the creation of the insurance Fund. The goal remains the same regardless of the method of insurance.
Consider what types of insurance exist:
In order to succeed in any activity, you need to consider the risks that can accompany you. A properly chosen insurance company will provide you with reliable protection.
Article in other languages:
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PL: https://tostpost.com/pl/finanse/20182-definicja-funkcje-cechy-i-cel-ubezpieczenia.html
TR: https://tostpost.com/tr/maliye/20214-tan-m-fonksiyonlar-zellikleri-ve-amac-sigorta.html
UK: https://tostpost.com/uk/f-nansi/20204-viznachennya-funkc-osoblivost-y-meta-strahuvannya.html
Alin Trodden - author of the article, editor
"Hi, I'm Alin Trodden. I write texts, read books, and look for impressions. And I'm not bad at telling you about it. I am always happy to participate in interesting projects."
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