Insurance companies (both life and general insurance) contribute significantly to the economic development. The role of general insurance on economic development is as follows:
Insurance helps to protect capital employed in the industry
and economic activity by protecting the assets life plant machinery from perils
and risks.
General insurance removes the worry and fear associated
with several business risk. This encourages entrepreneurial expansion of an
economy.
Banks and financial institutions lend money to industrial
and commercial undertakings only if it is collateral securities like property
are fully insured.
Before the acceptance of a risk the insurer surveys and
assesses the risk. Engineering surveys play a vital role in preventing industrial
accidents and losses.
It increases productivity and saves national wealth because
insurers are associated with various institutions who engage in activities like
cargo loss prevention, industrial safety, road safety, etc.
Indian general insurers operate in more than 30 countries
through agencies, branches and subsidiary which increase foreign trade.
India is an agriculture-based economy. General insurance
gives the agriculturists the ability to carry on business in the face of uncertainties
of weather, crop failure ad risk associated with livestock.
No comments:
Post a Comment