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Get to know Insurance, Types and Benefits


Dec 15, 2020
Get to know Insurance, Types and Benefits

Nobody plans to get sick or lose anything valuable. However, there is nothing wrong if you have something that can protect the health or safety of the things you have. The first time insurance came, it was not very popular with many people. The majority still think that the need for insurance is not urgent. Every average person still has the mindset that insurance protection is not the main and not important to have. In addition, many also think that young people do not need insurance because generally they will not get sick at all.

This mindset must be changed immediately, because no one can guess when you have a disease or lose something valuable. Insurance can play a role as a protection from all sudden needs. That’s why you need to have insurance. For more details, below will discuss the complete insurance.

1. Definition of Insurance

Insurance companies continue to educate about how important it is to have insurance in the long term. Insurance itself has the meaning of an agreement in which the insurer binds himself to the insured, by receiving a premium for self-compensation for damage or loss of profits that the insured may suffer due to a sudden event.

Insurance is a tool to reduce risk by combining a number of risky units so that individual losses can be predicted together. The predicted losses are then divided and distributed fairly and evenly among all the units in the combined.

2. Insurance benefits for you and your family

After you understand what insurance is, of course, you must know what the main benefits of insurance are for you and your family. In general, insurance can be a profitable long-term investment. Below will be discussed what benefits you can take if you have insurance.

a. Transfer of Risk

The main and most important objective of insurance is risk transfer. In theory, the transfer of risk means that the insured is aware of the threat of danger in the short or long term to his life or property. If one day these threats come true and befall you, it is certain that you will suffer loss or casualties. You, as a threatened party, will feel the burden of risk that can occur at any time.

By registering insurance with yourself and your family, you don’t need to bother to bear the burden of this risk. Insurance will play a role in taking over from your risk by simply paying the contra performance known as the premium. By paying a premium to an insurance service provider, from then on, your risk will move to the insurer or the insurer.

b. Compensation Payment

The benefit of the next insurance is for compensation payments. If you experience an event that causes losses, such as a fire in your house, there is no problem with the risk that will be borne by you. In accordance with the premium you choose, the insurance company will compensate for the losses you experience. However, every insurance has a ceiling limit from the coverage that can be given. The losses you experience will not really be covered one hundred percent, but your financial burden will be drastically reduced.

c. Compensation Payment

Insurance is also useful for paying compensation for you. One of the insurers that offers compensation payments is life insurance. Life insurance is held based on a free agreement between you and the insurer. However, the law also regulates compulsory insurance.

Insurance regulated by the law can be categorized as social insurance such as BPJS Kesehatan. Social insurance also has the aim of protecting people from health threats that can lead to death and others.

d. Welfare of Members of Insurance Participants

The benefits of other insurance are for the welfare of the members of the insurance participants. If there are several people gathered in an association, the association has the position of the guarantor. Insurance with a type for the welfare of its members is very similar to a cooperative association.