Life is full of uncertainties and insurance is based on uncertainties and if there are no uncertainties

about the occurrence of a disaster, the concept of insurance will cease to exist. For insurance, if one is
able to predict the forthcoming dangers, then one will take a proper safeguard action and then face the
crisis in a very normal manner, but then this is a utopian concept; because death, disaster and dangers
cannot be predicted. All individuals have assets; both tangible; the house, car, factory or intangible like
the voice of a singer, leg of a footballer, the hand of an author and many others. Now all such assets are
insured because they run the risk of becoming non-functional through a disaster or an accident. Such
possible and unforeseen occurrences are known as “Perils”. And the damage caused by such perils is
called risk that the assets are exposed to. Risk is a contingency and the insurance is done against such
possible contingencies.Uncertainty, risk and insecurity are incidental to any form of business. This makes
insurance indispensable for a business organization. Insurance may be defined as a contract in writing
under which one party agrees to indemnify the other party against a loss or damage suffered by it on
account of an uncertain future, in return for a consideration called 'premium'. The person/business that
gets its life/property insured is called 'Insured/Assured'. The agency which helps in entering into an
insurance arrangement is called 'Insurer' or 'Insurance company'. The agreement or contra