The implementation of the relationship of personal and commercial insurance is reflected in the implementation of the insurance business. This is the name of a set of actions designed to compensate for possible damage to financial standing or health. The types of insurance, its impact on social and economic life are described in this article.
Modern development of insurance business
Laws on the organization of insurance have been adopted in all civilized countries of the world. In general, government policy is based on insurance as an additional factor that reduces material costs from the budget in case of any risks. The development of insurance in the Russian Federation has taken the path of social insurance. In practice, it is expressed in the compulsory (at the legislative level) collection of regular contributions from the working population for social and pension insurance. The amount of contributions in this case is regulated by law.
In developed countries, by contrast, more attention is paid to voluntary insurance. Various commercial insurance companies offer medium-term health and material support programs in old age. Thanks to such programs, insurance companies collect impressive funds as contributions, thereby gaining the opportunity to invest the funds received in profitable, but expensive projects.
The share of insurers in world GDP
The share of collected insurance premiums in relation to world GDP is about 7%. In the leading countries of the insurance industry, this figure exceeds 10%. For example, in the Netherlands, the profit of insurance companies is 12.9% of the country's GDP, in the UK - 15.7%, respectively.
Types of insurance
In our country, the law on the organization of insurance business was adopted in 1992. Since then, it has been repeatedly changed and supplemented. Currently, the law on the organization of insurance in the Russian Federation speaks about the types of insurance offers distributed in our country.
- social insurance is the one mentioned above. These are compulsory deductions to the Pension Fund, the Social Insurance Fund and others;
- compulsory insurance, which is carried out through non-state insurance companies. Basically, we know from compulsory motor third-party liability insurance, the policy of which all car owners in the country must have;
- voluntary insurance. It includes the entire array of insurance services that are provided to all individuals in our country.
A separate item can be identified commercial insurance. It can be both voluntary and mandatory. For example, insurance of residential new buildings and construction projects of strategic importance is compulsory. Insurance guarantees are also required when making major financial transactions.
Organization of insurance business
The implementation of the insurance business is to stipulate insurance risks and to make payments upon the occurrence of specified events. At the same time, the insurance organization is an intermediary guaranteeing the redistribution of funds between economic entities depending on the degree of increase in social and economic risks. The higher the risk, the greater the payout. But all insurance organizations do not consider as insured events the totality of force majeure circumstances that are prescribed in each contract and must be studied very carefully by each insured person.
The main players in the insurance market are:
- insurance and reinsurance organizations;
- insurance intermediaries (they can be brokers and insurance agents);
- insurance outsourcing entities. This is the name of people who directly evaluate insurance objects, deal with the settlement of insurance claims, conduct audit of insurance reserves, assess the reliability of insured events and others;
- insurers, insured persons and beneficiaries;
- regulatory bodies, insurance market regulators.
In more detail, the whole range of relationships between participants in this specific market is studied by students involved in the specialty "Insurance Business". It is they who have the responsibility to raise the domestic insurance market and make it attractive to all participants in the process.