Page 52 - DCOM309_INSURANCE_LAWS_AND_PRACTICES

Unit 3: Nature and Scope of Insurance

Peril: Peril is defined as the cause of the loss. Notes
Risk: It is defined as the variation in possible outcomes of an event based on chance.

3.9 Review Questions

1. “Insurance is a device to share the financial losses.” Explain.
2. Discuss the nature of insurance.

3. Explain the primary functions of insurance.
4. “Lesser premium invites more business and more business cause lesser share to the assured”.
Discuss briefly.
5. How does insurance eliminate worries and miseries of losses?

6. What is the scope of insurance? Also, discuss the scope of insurance professionals in India.
7. Compare and contrast insurance, gambling and hedging with suitable examples.
8. Discuss the role of insurance in economic development.

Answers: Self Assessment

1. Probability 2. Endowment
3. Immaterial 4. Uncertainty
5. Guarantees 6. Economic
7. Contract 8. Tax

9. Insured 10. Premium
11. Future 12. Fluctuation
13. Loss 14. Fraction
15. Morale 16. Prosperity
17. Housing 18. Economies

3.10 Further Readings

Books Gulati, Neelam. C. (2011), Banking and Insurance, Excel Books.
Gulati, Neelam. C. (2013), Principles of Risk Management and Insurance, Excel Books.
Krishnaswamy, G. (2009), Principles and Practice of Life Insurance, Excel Books.
Misra, M.N. and Mishra, S.B. (2009), Insurance Principles and Practices, S. Chand
Publication.
Sahoo and Das (2009), Insurance Management: Text and Case, Himalaya Publication.

Online links http://insurancewindows.blogspot.in/2012/06/functions-of-insurance.html
http://business.tm-india.com/insurance/

http://support.sas.com/publishing/pubcat/chaps/62823.pdf

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