Insurance

Insurance is a mechanism designed to reduce the risks of an individual or legal entity by transferring them to an insurer on the basis of a contract. A contract under which one person (the insurer) agrees to ensure or guarantee to another person (the insured) that the damage caused by a specific reason or the income due in the occurrence of the specified circumstances will be reimbursed in the future by the former, to whom, on the basis of a counter-satisfaction, the latter will be paid the amount of the established insurance premium within the specified period.

The terms and conditions of insurance are prescribed in the contract.

There must be two parties to the agreement. The first is an insurer – a state, joint-stock or other organization that is engaged in the creation and use of a monetary fund. The second is the insurer – a citizen, enterprise or entrepreneur who makes fixed payments to the fund. Insured persons, beneficiaries, third parties who have suffered damage may become parties to the contract.

Under the insurance contract, the insurer undertakes to compensate for the damage caused by the occurrence of certain events. The policyholder (client) undertakes to pay a fixed payment – an insurance premium. The object (the event in which the compensation is paid) depends on the type of insurance.

Protection of life. Payments are provided for the death of the insured person, the onset of disability as a result of an accident, and survival to a certain age specified in the contract.
Property protection. Damage caused to the insured's property as a result of fire, flooding and other cases provided for in the contract is subject to compensation.
Property protection. The risk of loss or damage to the structural elements of the house or apartment is insured.
Vehicle protection. The insurer undertakes to compensate for the damage caused to the insured car, etc.
Types of insurance
Insurance can be commercial and non-commercial. Classification by industry separates personal, property and liability insurance.

There is also comprehensive insurance. This protection combines coverage against several risks at once. Comprehensive insurance includes, for example, travel insurance.

Personal insurance is divided into two types:

risky: insurance against illness, accident, sports injury, etc.;
Accumulative: annuity insurance, life insurance to a certain age, etc.
Types of insurance by form:

mandatory: regulated by law;
Voluntary: the contract is concluded at the initiative of the insured.
A distinction is also made between group and individual insurance. In group insurance, the policyholder (as a rule, the head of the organization) enters into an agreement with the insurer in favor of its employees. Individual protection is the issuance of a policy for a specific individual.

Coinsurance is a form of insurance in which a contract for one property is concluded with several insurers.

Reinsurance is a secondary distribution of the assumed risk, a system of economic relations, according to which the insurer, taking risks for insurance, transfers part of the responsibility for them to other insurers (reinsurers) on agreed terms.