INTRODUCTION TO INSURANCE

Human beings are exposed to various kinds of risk in their daily lives and activities and have to endure the consequences of such misfortune. Misfortune can arise in many forms which, inevitably, lead to different types and nature of losses. 

some examples are:

• A sole breadwinner of a family is involved in an accident and dies permaturely. Undoubtedly, the dependents will face two immediate obvious forms and losses - emotional and financial

•  The premises of a factory may be destroyed by fire. The owners of the factory will face, beside other losses, the loss of income which the factory would have been able to generate if the fire had not occurred. On the other hand, those employed by the factory may face the prospect of redundancy and unemployment. 

We can give countless examples of events which lead to human grievances and financial losses.

The natural question to ask then is :
"What arrangement(s) can be made to overcome or at least reduce the consequences of misfortune that may befall any one person?"

In answering the above question, we have to admit that not all forms of loss can be made good or be expressed in pecuniary terms. For instance, the emotional trauma arising from the death of loved one cannot be made good by any conceivable compensatory system.

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