ROLE AND IMPORTANCE


The role and importance of insurance has been discussed in three phases:
A) To individual
B) To business or industry
C) To the society

A) To individual
1. Insurance provides security and safety: Insurance provides safety and security against the loss on a contingency. In the case of life insurance, payment is made when death occurs or on the expiry of the term of insurance. Therefore, security against premature death and old age sufferings are provided by life insurance. Similarly in other insurances too, the security is provided against the loss from a given contingency

2. Insurance affords peace of mind:
The knowledge that insurance exists to meet the financial consequences of certain risks provides a form of peace of mind. Suppose our car is stolen we can be confident that we will be compensated for our loss

3. Insurance protects mortgaged property:
At the premature death of the mortgager, the ownership passes to the money lender and the family is deprived of the property. But if the property is insured, the insurer pays ofl the loan and the dependants retain their right over the property
4  Insurance eliminates dependency:
Life insurance protects the family's financial well being incase of death or disability of the bread winner. There are certain insurance policies and annuities which are useful for education of children and their marriage irrespective of the death or survival of the father or guardian.Old age insurance ensures that the insureds get fixed monthly income during their old age.
5. Life Insurance encourages saving:
Most of the life policies combine the programmes of insurance and savings Systematic saving is possible beçause regular premiums are required to be compulsorily paid. The deposited premium cannot be withdrawn easily before the expiry of the term of the policy
6. Life Insurance provides profitable investment:
In India insurance policies carry a special exemption from Similaryhelp income tax. Different types of plans offered by private insurers help the insured to get good returns at minimum premium. 

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