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What Is Insurance?
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Resource of the latest information of What Is Insurance?. It contains other latest useful information of What Is Insurance? along with other details of Mortgage, Loans, Lenders and other money facts. Keep on visiting the site for the latest and updated detail of What Is Insurance?.
What is Insurance?
History of insurance:
In some sense we can say that insurance appears simultaneously with the appearance of human society. We know of two types of economies in human societies: money economies (with markets, money, financial instruments and so on) and non-money or natural economies (without money, markets, financial instruments and so on). The second type is a more ancient form than the first. In such an economy and community, we can see insurance in the form of people helping each other. For example, if a house burns down, the members of the community help build a new one. Should the same thing happen to one's neighbour, the other neighbours must help. Otherwise, neighbours will not receive help in the future. This type of insurance has survived to the present day in some countries where modern money economy with its financial instruments is not widespread (for example countries in the territory of the former Soviet Union).
Current Definition:
Insurance is the transferance of risk. you have a risk for example: you might get sick, you might die, etc. insurance Transfers that risk (or rather the financial hardship created by it) from you to the insurance company for a small monthly premium. So for example you might get sick and need $300,000 worth of medical services. So knowing you could never afford that, you purchase insurance, transferring the risk to the insurance company in exchange for your monthly premium.(by: www.answers.com)
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