We are required to be a smarter person in any case. We must be able to deal with the various challenges that will arise suddenly in order to minimize the losses that may occur. However, not many people have good skills in managing life like that. So it is not uncommon for people to experience koleps. This can be seen from any side. Whether it’s education, work, to preparation for retirement.
The ability to plan and prepare strategies in dealing with unexpected events in the future is something that needs to be improved. Why is this necessary? Because when you are increasingly unable to adjust to your needs with various challenges, the chances are that you cannot live an orderly and calmly.
Maybe many of you are wondering what exactly is the function of insurance? What is the importance of having insurance? It is important to know the benefits of life insurance now because it will be a guarantor or protector against unexpected events in the future.
Then what is the function of insurance? Insurance has three main functions, namely Risk transfer, Common Pool and Equitable premium
Risk transfer can be defined as a mechanism for transferring insurance risks that are uncertain and may result in losses. Individuals or business entities can transfer insurance risk.
The risks resulting from accidents, damage, health problems, death, lawsuits, even business interruption can be transferred to another party (insurance company) with a certain premium that is relatively small compared to the possible losses that may occur.
Common Pool is known for the first time in marine insurance, which works differently from today. Pool involves contributions made by its members after a loss has occurred.
Currently, the contribution (premium) is determined at the inception of the contract in the form of an insurance premium. Premiums from the insured for similar risks will be collected in the form of funds (funds) or a pool which will then be partially taken to pay for claims that occur.
Equitable premium is the determination of the appropriate method for the amount of contribution that is fair and reasonable in the form of a premium based on the level of risk and the type of object covered.
After knowing the importance and function of insurance for everyday life, you may be interested in immediately having insurance coverage.