The financial definition provides for the funding of the losses. The legal definition focuses on a contractual arrangement whereby one party agrees to compensate another party for losses. The Significance of this fact will be clear by the following example. Thus the risk is not averted, but the members share the loss on its occurrence. The persons exposed to a particular risk cooperate to share the less caused by that risk whenever it takes place. The function of insurance is to spread this loss over many persons through the mechanism of cooperation. So it is clear that every risk involves the loss of one or the other kind. The more specific definition can be given as following вЂњInsurance may be defined as a consisting one party (the insurer) agrees to pay to the other party (the insurer) or his beneficiary, a certain sum upon a given contingency (the risk) against which insurance is sought.вЂќ The payment is made only upon a contingency.The payment will be made in a certain definite sum, i.e., the loss or the policy amount, whichever may be, and.Against the said consideration, a large sum is guaranteed to be paid by the insurer who received the premium,.Certain sum, called premium, is charged in consideration,.

The insurance, thus, is a contract whereby Insurance is defined as a form of risk management primary insurance has been defined to be that in which a sum of money as a premium is paid in consideration of the insurance incurring the risk of paying a large sum upon a given contingency. Insurance is a cooperative device of distributing losses falling on an individual or his family over many persons, each bearing a nominal expenditure and feeling secure against heavy loss. Similarly, another definition can be given. the method to provide security against losses to the insured.the principle to share the loss of each member of the society based on the probability of loss to their risk and.the system to spread the risk over many persons who are insured against the risk.a co-operative device to spread the risk.You should contact the insurance company or insurance agent directly for applicable quotes.Insurance is a cooperative device to spread the loss caused by a particular risk over some persons exposed to it and who agree to insure themselves against the risk. Any rates listed are for illustrative purposes only. This content is not, and should not be considered to be, a recommendation to life insurance products generally or an endorsement of a particular insurer or product. For more information about any of the companies or products profiled herein, or to inquire about the purchase of insurance, please contact the insurance company, an insurance agent, or a financial advisor. Some coverages, discounts, and features may not be available in all states. News nor the individual writers of this content are licensed to sell or advise on insurance products. News) prepared this content about insurance companies for general informational purposes only. When you use our links to buy products, we may earn a commission but that in no way affects our editorial independence. News 360 Reviews takes an unbiased approach to our recommendations. In addition, we maintain a separate business team that has no influence over our methodology or recommendations. All sample products provided for review are donated after review. Our 360 Reviews team does not take samples, gifts, or loans of products or services we review. To build our ratings, we researched more than 25 life insurance companies and agencies and analyzed 14 third-party review sources. Our 360 Reviews team draws on this same unbiased approach to rate the products that you use every day. News & World Report, we rank the Best Hospitals, Best Colleges, and Best Cars to guide readers through some of lifeвЂ™s most complicated decisions.

Principal definition insurance