What Is Insurance ?

Risk is the possibility of loss of scarce resources. Risk management is the practice of risk assessment and control and has evolved as a discrete field of study and practice, particularly in four areas of risk management techniques. That is the risk, risk prevention, risk retention and risk transfer, the latter also prevent known as insurance. 
So, Law and Economics, insurance is a risk management techniques that are used primarily for any loss caused insured person or organization that interests scarce resources to cover possible losses suffered by one who is interested, male, body or other. 
Rare resources listed are divided into three divisions: human resources, financial resources and capital, or real resources. 
In the insurance context of scarce resources, also known as the "revelation" because it "exposed" to do something or force, damage or reduction of risk of utility or value that causes an open source. 



Human resources at risk such as illness or death; financial resources for the Jewish Parliament Act, which may result from acts of negligence and funds for physical hazards such as fire, theft, assault and vandalism to name a few. The danger is the cause of danger. This is the thing or condition that the liklihood of risk. So the threats and dangers that threaten their exposures are identified. For example, for a smooth surface is seen as a threat to the capital, the financial harm or damage to humans by the owner of the car, and rightly so, because the liklihood of a car crash in an unfavorable court decision Automotive can cause damage and increase the injury.

Defined in terms of commercial retail, insurance, fair hereinafter referred to as the transfer of risk of loss, from one company to another, in exchange for wages, salaries, in the form of risk premium. Actuarily insurance premium rate increases are determined. This number is a factor used to determine the amount of increase in premiums, fees will be determined to some extent and type of insurance on scarce resources. Other awards to offset the losses, guaranteed bonds, financial resources are relatively small is considered as the insured, payable to the insurance company in exchange for a promise to the insurance (compensation) in the case of insured damage to the source of the Insured (s). Insured to receive a contract is insurance, the terms and conditions under which the balance covered by insurance.

Risk management is the identification, assessment and prioritization of risk, followed by co-ordinated and economical use to minimize resources, monitor and control the likelihood and / or the effects of unhappy events or (ISO 31 000 as a result of uncertainty on objectives, both positive negative defined) to meet the opportunities to maximize. Risks can come from uncertainty in financial markets, the failure of the project, legal obligations, credit risk, accidents, natural causes and disasters and deliberate attacks by enemies. Some risk management standards have been developed, including the Project Management Institute, the National Institute of Science and Technology, the actuarial community and ISO standards. Methods, definitions and purposes vary depending on whether the process of risk management within the framework of project management, security, technology, industrial processes, financial portfolio actuarial valuation, or public health and safety.

Strategies for risk management include the transfer of risk to another party, avoiding risk, reducing the negative effects of risk and the adoption of some or all of the consequences of certain risks.

Certain aspects of the many standards of risk management has come under fire because there was no measurable improvement in danger, even if confidence in the estimation and the improvement of the decision.

Next :

1 Principles 
     1.1 Insurability
     1.2 Legal
     1.3 Indemnification