“Insurance” – We think of this and the first thing that comes to is life and our families. That is so because we don’t know whether we will be alive a minute later or not. That’s a risk. What if I sleep today and never awake? What if I am the only earning member of my family? How will they manage without me? Therefore, insurance. So what have I done? Paid the insurer money and asked them to take care of my family in case something happens to me. This is life and individuals that we are talking about. Here there are unavoidable risks involved which are minimalistic risks and the probability of the risk occurring is very low. Now let’s consider a high risk environment – Business. If you want your company to grow and things to succeed, you have to take the risks. Without taking the risk there is no future growth for the company. Hence in this case, one of the best options is risk management. So how do you manage? One option – insure it. Yes, like individuals, businesses can be insured. www.tradesmansaver.co.uk is the example of one such website which provides insurance to businesses.
Where finance is the study of management and creation of money, investment and other financial instruments, Insurance is more to with the protection of a business or individual from a financial loss. It is a form of risk management, used to hedge against the risk of a contingent loss. It can also be described as a risk transfer mechanism that ensures full or partial compensation for a loss caused by an event beyond the control of the insured. The insurer and insured sit down and discuss all the possible risks that occur. The insurer calculates the risk that the events to be insured will occur and accordingly, the fee or premium to be paid by the insured is calculated. At the end, if the risk covered does occur, you can make a claim with the insurance company for the same, by detailing what has occurred; post which they would make the necessary inquiries at their end and if everything turns out fine – the claim would be processed and money compensated as covered. Companies that provide individual insurance and the ones that provide business insurance are different along with some online companies that provide insurance. One such example is – www.tradesmansaver.co.uk.
Life is full of risks and that makes life exciting to live. Some risks can be avoided while some cannot. However, there are certain risks or certain unexpected events which occur and set you back. Insurance is a way of ensuring that if that things do go wrong, at least monetarily, to a certain extent you are compensated or covered. Taking out insurance means that you are not facing these unexpected risks alone.