The Insurance

The Insurance

Life full of risks and presumed unexpected, because it is we need to understand about insurance. Some natural events that occur in the early years of late and eat a lot of victims, whether the victim lives or property, such as the need to remind us akan insurance. For each member of the society including the business world, the risk for experiencing advance (misfortune) as this always have (Kamaluddin: 2003). In order to overcome the losses incurred, humans develop a mechanism at this time we know as insurance.

Primary function of insurance is as a mechanism to transfer risk (risk transfer mechanism), the transfer risk from one party (Insured) to another party (guarantor). The risk of this does not mean the possibility of misfortune, but the insurer to provide financial security (financial security) and tranquility (peace of mind) for the Insured. As a return, pay a premium in the Insured the amount is very small when compared with the potential loss that may dideritanya (Morton: 1999).

Basically, the insurance policy is a contract that is a legal agreement between the insurer (in this case the insurance company) with the Insured, which the parties are willing to endure a number of insurer losses that may arise in the future with the reward payment (premium) from the Insured.



According to Law No. 2 Year 1992, is the insurance or guaranty is an agreement between two or more parties, with which the insurer tie themselves to the Insured with insurance premiums for the replacement of the Insured due to loss, damage or loss of the expected benefits, or responsibilities of law to third parties who may suffer akan Insured, arising from an event that is not certain, or to provide a payment based on life or death that someone be.

To prevent a potential loss (which may occur) can be insured (insurable) should have the characteristics: 1) the occurrence of the loss of uncertainty, 2) loss should be limited, 3) must be significant losses, 4) the ratio of losses can terprediksi and 5) loss is not katastropis (disaster) for the insurer.

Questions arise; death is certain, why can be insured? Although is a certainty, but the exact time of death when someone is outside the control page. So when the occurrence of death events that contain exactly the cause of uncertainty is what insurable.

There are two forms of agreement in setting the amount of the payment at maturity of insurance, namely: the value of the contract (valued contract) and contract indemnitas (contract of Indemnity). Contract value is an agreement where the payment amount has been determined in advance. For example, the value of insurance money (UP) on life insurance. Indemnitas contract is an agreement that the number of donate based on the amount of real financial loss. For example, the cost of hospital care.

In the case of an insurance company seeks a possible loss of fatal / major, then the risk can switch to another insurance company. This is called reinsurance, reinsurance companies that receive reasuradur called.

In addition to the five characteristics above, before it can be insured, the insurance company must consider the insurable interest and anti-selection. Insurable interest related to the relationship between the Insured and the recipient of the santunan / benefits - in case of loss potential. For example, insurance companies will not sell fire insurance policy in addition to the building owners who insured. Insurable interest in this case is against the ownership of the insured. Similarly, family relationships, the relevance of financial reasoned, is also a form of insurable interest. The anti-selection (counter selection) refers to the tendency to join larger insurance risk because it has a level above average. For example, people who have bad records or health risk venture would tend to buy insurance. To reduce anti-selection as a result, insurance companies must be able to identify and classifying the potential risk or loss. The process of identification and classification of risk is called underwriting or risk selection. However, it does not mean the selection of anti asuransinya rejected, because the risk for Insured losses above the average premium can be sub-standard (special premium) risk due to sub-standard (special risks) unless the possibility of loss is much higher, may apply asuransinya rejected.

Insurance History

Insurance began to come from the community Babilonia 4000-3000 BC, known as Hammurabi agreement. Then in the year 1668 M Coffee House in London stand Lloyd of London as the embryo of conventional insurance. Source of insurance law is positive law, natural law and an example as the previous culture.

Insurance mission to bring economic as well as with the social premium paid to the insurance company with a guarantee of transfer of risk, namely on (transfer) to the Insured's risk insurer. Insurance as a mechanism for the transfer of risk where the individual or business move some uncertainty as compensation premium payments. Definition of the risk of uncertainty here is not the case or a loss (the loss of uncertainty).

Insurance in India started in the Dutch colonial period, associated with the success of the company's land in the plantation sector and trade in Indonesia. To meet the insurance needs of business sustainability, of the required insurance. The development of the insurance industry in Indonesia had a vacuum cleaner during the Japanese occupation.

Assurance needs can be met by the Life Insurance

1) Personal needs, including: the provision of cost-the cost of living, such as final costs associated with death, the cost bill payment in form of loans or debt must be repaid; family allowance, costs of education, and pension. In addition, the life insurance policy with a cash value can be used as a savings and investment.

2) Business Needs, such as insurance on key persons (insurance for people in the company); business owners on insurance (insurance for business owners); employee benefit (welfare of employees) for example, life insurance and health groups.
source: Morton, G. (1999). Principles of Life and Health Insurance. Loma.