MEANING OF INSURANCE
Insurance is a co-operative device to spread the loss caused by a particular risk over a number of persons, who are exposed to it and who agree to insure themselves against the risk. Thus, insurance is a co-operative device to spread the risk or insurance is the system to spread the risk over a number of persons who are insured against the risk. Insurance is the method to provide security against losses to the insured. Similarly Insurance is a co-operative device of distributing losses, falling of an individual or his family over a large number of persons, each bearing a nominal expenditure and feeling secure against heavy loss.
Insurance is a contract whereby certain sum, called premium, is charged in consideration, against the said consideration, a large sum is guaranteed to be paid by the insurer who received the premium, the payment will be made in a certain definite sum, i.e., the loss or the policy amount whichever may be, and the payment is made only upon a contingency.
PARTIES TO INSURANCE
In insurance there are two parties: insurer and Insured. The agency which is helpful in this arrangement is known as "Insurer' or the Insurance Company. The person who gets his life or property insured is known as 'Insured' or 'Assured. The contract in writing is known as policy. Insurance premium is an amount to be paid by the insured either in lump sum or in installments at regular intervals.
DEFINITIONS OF INSURANCE
According to Justice Tindal, "Insurance is a contract in which a sum of money is paid by the assured in consideration of insurers incurring the risk of paying a large sum upon a given contingency."
According to Schultz and Bradwill, "Insurance in its technical sense is a social device which employs the use of pooling technique to eliminate un certainty.
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