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Basics of Insurance

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In boring terms Insurance is…

Definition of Insurance

“An arrangement by which a company or

the state undertakes to provide a

guarantee of compensation for specified

loss, damage, illness, or death in return for payment of a specified premium.”

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Lines of business (LoB)

Life Insurance

Non Life Insurance

Health Insurance

Insurer promises to pay a designated beneficiary a

sum of money (the benefit) in exchange for a

premium, upon the death of an insured person

Provide payments depending on the loss from a particular

financial event. General insurance is typically defined as any

insurance that is not determined to be life insurance

Type of insurance coverage that pays for medical

and surgical expenses that are incurred by the

insured

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Insurance line of business

Auto/Motor Insurance

Property Insurance

Pecuniary loss

Freight

Genera liability

Non-life insurance

Whole life

Term life

Endowment

Annuity

Investment linked

Life insurance

Accumulate wealth. Regular premiums pay insurance costs and contribute to equity growth in a savings account where dividends or interest is allowed to build-up tax-deferred

Provides coverage at a fixed rate of payments for a limited period of time, the relevant term

Designed to pay a lump sum after a specific term (on its 'maturity') or on death

Save money for retirement. Premiums earn interest, generally tax-deferred, and after a period of time, provide with a stream of income

Unit Linked Insurance Plan (ULIP) unlike a pure insurance policy, gives investors both insurance and investment under a single integrated plan

Marine, Aviation & Transport

Other non-life

Protect the general public from any accident that might take place on the road

Coverage for monetary loss due to a wide range of factors from external and internal influences

Provides financial reimbursement to the owner or renter of a structure and its contents, in the event of damage or theft

Indemnifying the policyholder against loss of the freight money if the ship-owner cannot complete his contract of carriage because of unavoidable peril

Protects the purchaser (the "insured") from the risks of liabilities imposed by lawsuits and similar claims, within the coverage of the insurance policy

Covers the loss or damage of ships, aviation, cargo, terminals, and any transport or cargo by which property is transferred, acquired, or held between the points of origin and final destination

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Sales channels

Agents

Brokers & advisors

Bancassurance

Direct sales staffs

Internet

Registered agent for one or more insurers. Gets paid through commission from Insurers

They act on their clients' behalf to negotiate and obtain the most appropriate insurance covers at competitive premium rates from their insurers, exercising care and skill in doing so

Selling of insurance products and services by banking institutions

Selling by the direct staffs of insurance companies

Selling through digital/mobile channels

Channel Description Commission

From Insurer

From Insurance advise seeker/ Insurer

From Insurer

Salary from Insurer

Inte

rmed

iari

es

Dir

ect

39.4%

30.7%

29.1%

29.2%

31.1%

28.9%

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Customer purchase process

Underwriting

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Insurance claims process

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Insurance will have major digital transformation

000

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Key terms to know

• Insurer: A person or company that accepts the risk of loss and compensates the insured in the event of loss in exchange for a premium or payment. This is usually an insurance company

• Insured: The person or company transferring the risk of loss to a third party through a contractual agreement (insurance policy). This is the person or entity who will be compensated for loss by an insurer under the terms of the insurance contract

• Insurance Rider/Endorsement: An attachment to an insurance policy that alters the policy's coverage or terms

• Bound: Once the insurance has been accepted and is in place, it is called "bound". The process of being bound is called the binding process

• Reinsurance: Insurance that is purchased by an insurance company from one or more other insurance companies as a means of risk management or sometimes tax mitigation

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About RapidValue

RapidValue is a leading provider of end-to-end mobility, omni-channel and cloud solutions to

enterprises worldwide. Armed with a large team of experts in consulting, UX design, application

engineering, testing, along with experience delivering global projects, we offer a range of services

across various industry verticals. RapidValue delivers its services to the world’s top brands and

Fortune 1000 companies, and has offices in the United States and India.

www.rapidvaluesolutions.com www.rapidvaluesolutions.com/blog

+1 877-643-1850 contactus@rapidvaluesolutions.com

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