Insurance is basically the transfer of risk of losses from one entity to another. The transaction of insurance consists of a payment against the shield of losses from one party. The person who is obtaining the services of insurance is called insured and the person who is providing those services is known as insurer. The technique of insurance is used for hedging against the risk of any future, contingent and uncertain loss which may or may not arise in the future. The activity has recently become one of the most popular activities in the world and is included in almost all the company’s risk management policy in the modern times. Through effective use of insurance, the risk of loss can be managed and mitigated to a great extent. The field of insurance has grown to such an extent and has become so widely practiced that it has attained to level of a separate field that is being studied and practiced.
The technical nature of insurance involves that a payment that is known as premium is made periodically from insured to insurer. The insurer in return promises to shield the insured in case of the loss to a certain extent by providing a guarantee for a certain amount of sum or for indemnifying the actual amount of loss in the events of a loss. The contract which is signed by the parties while obtaining the services of insurance is known as insurance policy. All of the terms and conditions of insurance contract are stated on the policy as well as the circumstances are mentioned in which the insurer will be liable to compensate the insured. Insurance brokers may also become part of the transaction in some of the cases.
Insurance can be obtained by both people and businesses. Businesses obtain insurance to avoid losses in business transactions while people normally get the insurance services such as Life insurance, health insurance, long term disability insurance, business liability insurance in Dubai and auto insurance. All of these insurance services are quite commonly known to a layman and cover the losses during the day to day operations performed by the particular person.
Insurance can be obtained from both recognized and well known international companies and any person that can act in the capacity of insurer. As long as the basic mechanism of insurance is being followed, the transaction and agreement between the two parties will be known as insurance. There are some renowned names in the field of insurance that provide the services of international insurance as well as domestic insurance services. Due to a lot of travelling, international insurance has become quite common and people prefer that kind of investment however the increased benefit of global insurance comes with a cost of higher premium.
Like in the other parts of the world, insurance has become a well known and popular activity among the people of UAE after the industrial development. A lot of businesses are operating in the region and they are the main reasons because of which a lot of international firms in the field of insurance have made their way into the market of UAE. The UAE insurance industry includes popular names such as Emirates Insurance Co, Dubai Insurance Company, and Al Khazana Insurance Company etc.
Summary: Insurance has become quite a popular stuff in the world. The activity basically deals with the risk management and saves the company or a person from uncertain losses. There are a lot of companies that provide the services of insurance. Some of these are internationally recognized firms. The field has grown so much that it is now included as a separate field.