Meaning Of Insurance
Future is always uncertain. Misfortunes are part of human life. Mishappening are always unexpected and sudden. Business as human activity is victim of various and varied risk. The risks may be carted incidentally with the causes of natural, seasonal, geological, physical, economic and human causes etc. It impossible to eliminate the happening of an uncertain event or risk. The life and property of businessman is always at risk. It was therefore, desired that there should be certain agency which should be established to undertake risk, compensate for the loss and relieve the psychological pressure of insecurity and uncertainty of the future. The desire was fulfilled and the objective was achieved by taking insurance policies. Insurance means protection against risk or loss. Insurance is a way of reducing uncertainty of occurrence of an event. It covers the risk of loss. The insurance is contract whereby one party agrees to pay a certain spectacled sum, on the happening of particular event, to the other party, who is turn agree to pay a sum in the form of premium for its consideration.
According to Tindil, "Insurance is a contract which a sum of money is paid by insured in consideration of the insurer's incurring the risk of paying a large sum when the given contingency arises". In the word of Edwin W. Patterson, "Insurance is a contract by which one party for compensation called premium assumes particular risk of the other party and promises to pay to him or his nominee a certain sum of money on specified contingency". According to MK Ghogh and An Agrawal, "Insurance is a simply a co-operative from of distributing a certain risk over a group of persons exposed to it"
From the above definitions, we can say that insurance is contract between two parties i.e. between insurer and insured. The one party(insurer) takes over a particular risk of other party in tha payment of premium. Insurance covers only such risks which can be measured in terms of money. Now a days insurance is done by insurance companies. A s insurance company specializes in acting as professional insurer. Traders and businessmen can transfer their risk to the insurance company by entering into a contract of insurance.
According to Tindil, "Insurance is a contract which a sum of money is paid by insured in consideration of the insurer's incurring the risk of paying a large sum when the given contingency arises". In the word of Edwin W. Patterson, "Insurance is a contract by which one party for compensation called premium assumes particular risk of the other party and promises to pay to him or his nominee a certain sum of money on specified contingency". According to MK Ghogh and An Agrawal, "Insurance is a simply a co-operative from of distributing a certain risk over a group of persons exposed to it"
From the above definitions, we can say that insurance is contract between two parties i.e. between insurer and insured. The one party(insurer) takes over a particular risk of other party in tha payment of premium. Insurance covers only such risks which can be measured in terms of money. Now a days insurance is done by insurance companies. A s insurance company specializes in acting as professional insurer. Traders and businessmen can transfer their risk to the insurance company by entering into a contract of insurance.
