The insurance business is a business of taking over the riskRisk Risk is a loss that occurs to the insured individual or object. Various bad possibilities could happen to someone. from the customer to be borne by the insurance company. The way to cover the risk is to use the accumulated premiumPremium The money that must be paid at a certain time is the obligation of the insurance policyholder. The amount of premium paid is determined by the policy and approval of the insurance company in accordance with the conditions of the insured. The nominal payment approved by policyholders and insurance companies. Premium payment will be made according to the agreement, it can be monthly, yearly, or according to the agreement. funds paid by the customer to cover the claimsClaim The demands are given by the insurance policyholder to get the right properly so that the insurer pays the conditions according to the existing procedure. of the customer affected by the disaster/risk.
Simply put, take the example of a merchant association, there are 100 people who are members of insurance by paying a premium of USD 3 thousand. The total accumulated premium is USD 300 thousand. It is estimated that out of 100 traders, there are five people affected by the disaster with a loss of USD 50 thousand each so that the total loss is USD 250 thousand.
The insurance company that acts as the insurerInsurer A person who is legally listed in the insurance policy to make premium payments for that policy. of the risk uses the accumulated premiumsPremium The money that must be paid at a certain time is the obligation of the insurance policyholder. The amount of premium paid is determined by the policy and approval of the insurance company in accordance with the conditions of the insured. The nominal payment approved by policyholders and insurance companies. Premium payment will be made according to the agreement, it can be monthly, yearly, or according to the agreement. to cover the risk of the claims of merchants affected by the disaster. Meanwhile, those who are not affected by the disaster cannot accept coverage from the insurance company.
The work process of an insurance company is divided into 3 simple stages, namely:
Attract Customers:
Insurance companies offer products and are looking for someone who will become a customer. The insurance company will divide each insurance buyer or policyholder into different sections. So, if you use health insurance, it will not be mixed with life insurance or anything else. The insurance will cover any of your losses in accordance with the amount taken by the policyholder.
Collecting Premium:
The system run by insurance companies is the circulation of money from customers to cover risksRisk Risk is a loss that occurs to the insured individual or object. Various bad possibilities could happen to someone. experienced by other customers.
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Customers will be given a premium payment schedule which is usually done every month. Through this premium payment, the amount of money from each customer will be processed in order to overcome problems experienced by other customers and those who make claims to the insurance company. So, the system run by insurance companies is the circulation of money from customers to cover risks experienced by other customers.
Paying Claims:
If there is a claimClaim The demands are given by the insurance policyholder to get the right properly so that the insurer pays the conditions according to the existing procedure. from a customer who is at risk, the insurance company must pay according to the provisions. The insurance company will ensure that the occurrence of claims made by the customer is a true disaster and is not an accidental incident. In a policyPolicy The policy is a binding agreement and is agreed upon by the insurance company and policyholder in writing. An agreement made by the policyholder with an insurance company. clauseClause The articles contained in the policy agreement that policyholders and insurance companies must comply with., there is usually an agreement that if the incident has an intentional element, the insurance company will not give compensation.
Having insurance will help you to no longer fear facing the future. If you are better prepared for the future, everything will run more safely and comfortably. Understanding how the insurance company works above will make you more determined to join the insurance program.
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