The main purpose of insurance is to provide financial protection against the risks of potential losses such as Death, Property Damage & Medical Costs. Insurance helps to protect individuals & businesses from financial losses due to unexpected events.

Insurance and its benefits

Insurance is a contract – between an individual & an insurance company which provides financial protection against loss or damage from an unforeseen event. It is a type of risk management which is used to protect individuals and businesses from financial losses. The benefits of insurance are that it provides financial protection against unexpected events such as Accidents, Death, Illness, & other unforeseen events. It also helps to spread the financial risk of losses among many individuals and businesses, so that no single person or entity is responsible for all of the losses. Additionally insurance can help provide peace of mind, knowing that if something unexpected were to happen, the financial burden would be covered.

Main principles of insurance

Utmost Good Faith: This principle requires policyholders to provide full and accurate information to insurers when they request it.

Indemnity:- This principle requires insurers to pay out an amount that is equal to the loss suffered by the policyholder.

Subrogation: This principle allows insurers to pursue legal action against those responsible for the loss, in order to recover the funds they have paid out.

Benefits of insurance

Financial Security: Insurance provides financial protection against unexpected losses.

Risk Reduction: Insurance helps to reduce the risks associated with everyday life.

Peace of Mind: Insurance provides peace of mind knowing that you are covered in case of an emergency.

Cost Savings: Insurance can help to lower the overall cost of potential losses.

Disaster Protection: Insurance can help to protect against the financial losses associated with natural disasters.

Flexibility: Insurance plans can be tailored to fit individual needs.

Retirement Planning: Insurance can be used as an effective retirement planning tool.

Tax Benefits: Insurance plans may offer tax benefits to policyholders.

Asset Protection: Insurance can help protect against the loss of assets due to theft, damage, or other events.

Estate Planning: Insurance can help to protect assets and provide for dependents in the event of death.

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