What is Insurance and Why Insurance is required?

Insurance denotes or implies a binding agreement between two or more parties engaged by a written agreement enforceable by law involving between Insured and Insurer. When we look at the meaning of the words insured and insurer.

The "Insured" connotes about a customer who is inclined to acquire Insurance. A Insurance company which is entrusted to endure the loss of insured which is carried out it in a policy is called "Insurer". The contract is met with the expectations of insurer against acknowledgement of detailed amount. Simply it is ascertaining of agreement that would interfere between insured and insurer.

The insurer is the one who accepts to bare any kind of loss that may be subjected by the insured which is assigned to the matter of any possibility of danger as discussed in the matter of insurance. Usually two types of insurance are available for customers they are Life insurance and General insurance. 

Life Insurance is for defending dangers involved in our lives where as General Insurance constitutes Liability Insurance, Property Insurance, Motor Insurance, Fire Insurance,  Marine Insurance, Health Insurance and Shopkeeper Insurance are the different forms of Insurance.

Property Insurance is the activity of covering unexpected damage or accidents which are natural or artificial like floods, storm or fire. Professional indemnity policy is insured by various professionals like doctors, lawyers insured for their occupation involved risks and shielding the damages, accidents, and other possibility of risk is protected against in Motor insurance. 

What is the requirement for Insurance? 

Defending asset is the matter of interest for both individuals and group of people which resulted in seeking continually. Theft, fire, flood etc are playing in opposition to mankind which are most common sources. Time, strength, intelligence are earned by man for the purpose of benefiting. Instruments like vehicles, factories, ships for transportation, production, trade are the other requirements. These resources in turn affords for further wealth accumulation. But if surprisingly when these aspects are lost or destroyed before anticipated time it incurs undesirable loss.

Human being earns during his life time and should fulfill the obligation to provide income for himself or for his needs during old age. But unexpected accidents or untimely demise at the young age, leave the dependents in the family unprepared for survival. If a motor vehicle is lost or damaged completely before 10 years of its expected lasting time the entire capital is lost and owner cannot substitute it with another one due to accident. So the Insurance becomes mandatory for Life and Non life to come together and act for common strategy to cover the loss of worthful asset ultimately.

What is the necessity to take insurance?

Composing of checks every month and never put to use the insurance rights. In that case we need insurance to assure security for monthly investments for life and nonlife.