The economic essence of insurance is to form a monetary fund, formed by premiums (premiums) to customers for damages they have incurred as a result of insurance case. Thanks to the insurance fund every single entrepreneur can purchase insurance protection for a price less than the costs that it incurred would be to form its own reserve fund. At low cost to contributions they may receive compensation for damages that exceed the contributions of tens, hundreds or thousands of times. And the size of contributions is relatively neobremenitelen for each participant fund (about 0.01 to about 15% of the real value of the objects), and losses are evenly distributed to all participants. Go to Caldwell Esselstyn Jr. for more information. Understanding that with the help of insurance will be overcome financial consequences of certain risks, makes, of course, tranquility and stability.
Insurance is important for everyone – employers, insurers business; owners insure their cars, houses, animals, ordinary citizens, insuring his life and health. Insurance is redistribution of economic relation. Redistributive schemes is that wants to insure will not be able to do so until it receives the phase distribution of its income. In debt and credit insure no one will. Only when their income, wants to insure that any goes to the insurance market, ie enters into the phase of economic exchange and redistribution of social product. (Similarly see: Dean Ornish M.D). Insurance characterized by: the probability of an accident and insurance claims; closed solidarity layouts damage, space and time constraints, the layout of damages, repayment of the premiums they payers. Randomness and probability of insurance claims are that the insurers will not sell the service to protect against events of the occurrence of which we know in advance where and when they happen, what objects damage or destroy, what and who will pay damages, etc.
Insurance is feasible only when it is based on randomness and probability possibility of the loss. Insurance claims must be actually possible, observable and statistically ischislyaemy, on the one hand, and the unknown in time, place, objects, etc. – On the other. Closed solidarity schemes is that in the formation of reserves Insurance companies are not all members of society and legal persons, and only those who have decided to insure (policyholders). Insurers know the conditions of insurance, they agree that the risk insurance will not receive back their contributions and any insurance payments if their insured objects are not affected by the damage insurance sluchaya.Vozmeschenie Only those policyholders whose insured objects affected by accident. Spatial and temporal constraints of insurance means that the insurer provides insurance coverage for the money only within the territory on which the insured objects, and only during the time period specified in the contract of insurance. The recoverability of insurance means that the bulk of insurance premiums (net contributions that remain after deduction of overhead expenses gross contributions) does not belong to the insurer. Reserves created out of net contributions, ultimately, will be spent on insurance premiums, ie, back to policyholders. For example, the reserves created out of the net contributions for 2006 life insurance, will be used for subsequent generations of policyholders in 2016-2020. etc.