Understanding The Conventional Or General Insurance

What's the sense of that insurance? Insurance word comes from the Dutch word "Assurantie" which in Dutch law called Verzekering meaningful coverage. The term of the term assuradeur Assurantie then arises for the insurer and the insured geassureerde. Insurance is a term used to refer to the act, system, or business where financial protection (or compensation financially) to life, property, health and so forth get reimbursement of events that can not be alleged that can occur such as death, loss, damage or pain, which involves the payment of premiums on a regular basis within a specified period in exchange for a policy which ensures such protection.

According to Law 2 of 1992 dated 11 February 1992 on Insurance Business ("Insurance Law"), insurance or coverage is an agreement between two or more parties with which the insurer bind themselves to the insured to receive insurance premium to provide reimbursement to the insured due to loss, damage or loss of expected profit, or legal liability to third parties which may be suffered by the insured arising out of an uncertain event, or to provide a payment based on death or life of an insured person.

While the definition of insurance according to the Code of Commercial Law (Commercial code), concerning insurance or age, Chapter 9, Article 246: "Insurance or Assured is an agreement by which a binding to an insured, to receive a premium, to provide reimbursement to him for any loss, damage or loss of expected profit, which may be suffered due to an event that is not certain. "

Based on these definitions above, insurance is one form of risk control, by transferring or transferring the risk from the insured to the insurer, in this case to the insurance company. Transfer is based on legal rules and principles that apply universally, adhered to by the insured party and the insurer.

insurance

Insurance contained in the terms that you may not know, for example, "insured" is the person or entity who distribute risk, "person" is the entity that receives such risks. Agreement between the two entities is called the policy: this is a legal contract that explains all terms and conditions are protected. While the fees paid by "insured" to "guarantor" for the risks covered by so-called "premium", while the "insurance policy" is written proof or a letter of agreement between the parties entered into insurance.

In the insurance world there are six basic principles that must be met, namely:

1. Insurable interest

Is entitled by law to mempertangungkan a financial risk associated premises, legally recognized between the insured with something that is insured.

2. Good Faith

In doing kontarak insurance, penaggung party needs to explain fully their rights and obligations during the period of insurance. In addition it should be noted is the treatment of the person when there really is a risk that befall the insured. The insurer must be consistent terhadat rights and obligations specified in the contract (policy), including restrictions that have so clearly if there is a risk that is not covered by insurance. The obligations of both sides to reveal the facts referred to the duty of disclosure.

3. Indemnity

A mechanism that overrides the insurer to compensate the insured with financial compensation. Indemnity principle can not be implemented in the accident and death. Indemnity can dilakuakn in several ways, namely cash payment, replacement, repair, and rebuilding.

4. Proximate Cause

For an active, efficient which led to the occurrence of an event in a chain or sequence without the intervention of the other provisions, starting and working actively from a new and independent source.

5. Subrogation

In principle is the right of the person who has been giving out compensation to the insured. To sue another party that resulted in the interest of having an event insurance losses.

6. Contributions

This principle is a corollary of the principle of indemnity, namely, the insurer has the right to invite another person in the party who have the same interests to join together to pay compensation to an insured even though the number of dependents of each are not necessarily equal.

Benefits and Advantages thinking about insurance can be obtained are as follows:

1. Sense of security and protection.

Insurance policies owned by the insured will provide safety from risk or harm that may arise. If such risks or keruguan actually occurs, the insured person (insured) are entitled to the value of the loss of value of the specified policy.

2. The distribution of costs and benefits more equitable.

The principle of fairness taken into account for determining the sum insured and the premium to be borne by the policyholder periodikdengan attention to the factors that influence the insurance. To get the sum insured, the insurer has made a calculation that is not detrimental to both large pihak.Semakin insured value, the greater the periodic premiums paid by the insured.

3. The insurance policy can be used as collateral to obtain credit.

4. Serves as savings and income sources.

Premiums paid each period is substantially the same as savings. The insurer also takes into account the interest on the premium paid and the bonus (according dewngan kedu agreement of parties).

5. Tool spread risk.

Risk that should be borne by the insured person involved is charged also in exchange for a certain amount of premium that is based on the sum insured.

6. Help increase business activities.

Investments made by investors saddled with the risk of loss can be caused by a variety of causes (theft, fire, accidents, etc.).

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