Importance can be taken to have very significant roles and benefits to us. The the insurance company is to cover the interest of the people in case the unfavorable event occurs. Insurance can also be defined as the social process by which it eliminates the risk of the loss of property and also life. The insurance companies play a major role in safeguarding the assets of the people at all levels.
The major role of the insurance is to provide security and safety. The insurance clients provide security to the clients by being able to provide financial security to the clients regarding a particular asset that had been insured. A a good example is a case where the insurance company can be able to provide financial assistance to the people who work in the areas that are prone to fire. Individuals who work in areas which can easily face the challenges of floods, disease calamities and such are covered against such calamities.
Working to generate the financial resources is one of the main benefits of the insurance companies. The insurance companies generate income from the premiums paid by the clients. Being able to buy the government stock is one of how the insurance company can be able to invest the amount generated from the premiums received. Being able to increase the profit of the insurance company is the effect of the premiums received for the organization.
The improvement of the economy leads to the economic development of a country. The insurance company undertakes to invest the profits in different sectors.
One of the crucial ways of encouraging saving is by a company being able to ensure itself. This is because the insurance enables people to save more by being able to encourage saving. This is by mainly being able to indemnify the people from the risks that they were likely to suffer from. People taking the endowment policy is one of the ways of investing. The person always gets the profit if the contract matures.
The insurance plays a big role in the growth of the country’s economic status.
The insurance company s able to bring together the savings from the people. The insurance promotes trading and commercial activities which results in economic growth and development. The country’s economic status is greatly influenced by the insurance company. Medical support is essential in managing the risk of health’s rise in the medical expense is of great concern. Medical insurance is a policy that caters to the different type of health risks. The insured gets a medical support in the case of medical insurance policy.
Being able to spread the risk to a large group of people is one of the key objective of the insurance company. Many people get insurance policies and pay premium to the insurer. Any time a loss occurs, it is compensated out of funds of the insurer.
Huge funds are collected by the way of premium. The funds are utilized in the industrial development of a country, thus increasing the economic growth.