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Insurance

Insurance is a contract that protects individuals from uncertainties in exchange for a premium. In India, there are 24 life insurance companies and 34 non-life insurance companies regulated by the IRDAI. Insurance agents, who can be independent or captive, sell policies on behalf of these companies and earn commissions or salaries.

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4 views2 pages

Insurance

Insurance is a contract that protects individuals from uncertainties in exchange for a premium. In India, there are 24 life insurance companies and 34 non-life insurance companies regulated by the IRDAI. Insurance agents, who can be independent or captive, sell policies on behalf of these companies and earn commissions or salaries.

Uploaded by

nitish.ranjan0420
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd

A necessity of today-

INSURANCE

What is insurance?
Insurance basically means 'to insure’ someone against uncertainties or
probable losses that may occur by some other being, company or state. In
other words we may say insurance is a promise in which one party guarantees
another party to secure him/her from future uncertainties in exchange of
some payment in any form called premium.

Insurance policy
Insurance policy is the contract between the insurer and the insured, who is
also known as the policyholder, which contains all the details about that
particular insurance and the legal claim payable by the insurer.

Insurance companies
Insurance have become a very popular business throughout the world. Many
companies have emerged in this business, out of which many companies have
grown as MNC's and they are functioning at global level. Their main source of
income is the premium received from the policyholders and their main
expenses includes settlement of claims, agent's fee, salary of employees,
etcetera.

Insurance companies in India


In India, there are many companies running in this business. As per a report
IRDAI has recognised 24 life insurance companies and 34 non life insurance
companies along with 2 reinsurance companies. They all functions as per the
rules and regulations setup by IRDAI( Insurance Regulation and Development
Authority of India).

Insurance agents
Insurance agents are the persons who sells the insurance policies on behalf of
insurance companies and get commission from the companies for the same.
There are two types of agents, that is, independent agents and captive or
exclusive agents. Independent agents works for many firms and gets the
commission as per the policies sold whereas captive or exclusive agents are
employed by a single insurance firm and sells the policies of that firm only, in
return they are awarded either by commission or by salary as an employee.

Insurance act
In India, Insurance companies are governed by Insurance act, 1938,
which was basically passed by the British during their colonial rule in
India. It provides the complete legal framework within which the
insurance business operates in India. Apart from this, there are other
acts also which separately deals with different types of policies, Life
Insurance of India Corporation Act, 1956 and General Insurance
Business (Nationalisation) Act, 1972 are among them.

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