Delhi Insurance Claim Lawyer, Insurance Lawyer Delhi

Delhi Insurance Claim Lawyer, Insurance Lawyer Delhi, Insurance, Definition of Insurance, Characteristics of Insurance, Nature of Insurance, Functions of Insurance

Insurance: in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the insurance; an insured or policyholder is the person or entity buying the insurance policy. The insurance rate is a factor used to determine the amount to be charged for a certain amount of insurance coverage, called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice. The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer’s promise to compensate (indemnify) the insured in the case of a large, possibly devastating loss. The insured receives a contract called the insurance policy which details the conditions and circumstances under which the insured will be compensated.

General Insurance: Insuring anything other than human life is called general insurance. Examples are insuring property like house and belongings against fire and theft or vehicles against accidental damage or theft. Injury due to accident or hospitalisation for illness and surgery can also be insured. Your liabilities to others arising out of the law can also be insured and is compulsory in some cases like motor third party insurance.

Definition of Insurance

  • Insurance is a cooperative form of distributing a certain risk over a group of persons who are exposed to it. – Ghosh and Agarwal
  • Insurance is a contract in which a sum of money is paid to the assured as consideration of insurer’s incurring the risk of paying a large sum upon a given contingency. – Justice Tindall
  • Insurance may be described as a social device whereby a large group of individuals, through a system of equitable contributions, may reduce or eliminate certain measurable risks of economic loss common to all members of the group. – Encyclopedia Britannica
  •  Insurance is an instrument of distributing the loss of few among many. – Disnadle
  • The collective bearing of risk is Insurance. – W. Beverideges
  • A provision which a prudent man makes against fortuitous or inevitable contingencies, loss or misfortune. – Thomas
  • Insurance is a device for the transfer to an insurer of certain risks of economic loss that would otherwise come by the insured. – Allen Z. Mayerson
  • Insurance has been defined as a plan by which large numbers of people associate themselves, to shoulders of all, risks attach to individuals. – Magee D.H.
  • Insurance may be defined as a social device providing financial compensation for the effects of misfortune, the payments being made from the accumulated contribution of all parties participating in the scheme. – D.S. Hansell
  • Insurance by lessening uncertainty, frees the individual from same element of risk. – Relph H. Wherry & Monroe Newman
  • Insurance is purchased to offset the risk resulting from hazardous which exposes a person to loss. – Robert I. Mehr and Emerson Cammack
  • Insurance is a contract by which one party, for a compensation called the premium assumes particular risk of the other party and promises to pay to him or his nominee a certain or ascertainable sum of money on a specified contingency. – E.W. Patterson

Characteristics of Insurance

  • It is a contract for compensating losses.
  • Premium is charged for Insurance Contract.
  • The payment of Insured as per terms of agreement in the event of loss.
  • It is a contract of good faith.
  • It is a contract for mutual benefit.
  • It is a future contract for compensating losses.
  • It is an instrument of distributing the loss of few among many.
  • The occurrence of the loss must be accidental.
  • Insurance must be consistent with public policy.

Nature of Insurance

  • Sharing of Risks
  • C0-operative Device
  • Valuation of Risk
  • Payment made on contingency
  • Amount of Payment
  • Large Number of Insured Persons
  • Insurance is not gambling
  • Insurance is not charity

Functions of Insurance

Primary Function

  • Provision of certainty of payment at the time of loss
  • Provision of protection Risk sharing

Secondary Function

  • Prevention of loss
  • Provision of Capital
  • Improvement of efficiency
  • Ensuring welfare of the Society…