The agreement on the protection of property in the event of insured events at the expense of the subject's contributions is called insurance. In this case, the insurer is the entity registered for this activity, as well as having obtained a license for this. The insured is the entity that pays the premiums and has a legal relationship with the insurer.
Insurance is divided into certain types. By type is meant the corresponding tariffs of certain homogeneous objects in a specific amount of insurance liability. The word "insurance" has Latin roots, as Western philologists believe, and translates as "carefree." In Slavic languages they believe that the term “insurance” is a kind of derivative of the word “fear”. In the Russian Federation insurance is an entire scientific system by which this type of activity is classified by industry, type, special links and areas.
Insurance classification is based on differences in liability. It can also be based on the difference in insurance objects. In 1978, the classification and types of insurance were established for the countries of the EEC. This classification is created in accordance with the laws and the EEC directive on insurance companies. The classification of insurance includes 6 types of long-term and another 17 types of general.
Long Term Views:
- ongoing health insurance;
- pensions;
- financial losses;
- life
- to the wedding and the birth of a child;
- endowment insurance.
Classification of types of insurance related to general:
- Car insurance.
- From accidents.
- Material objects (property).
- Rail transport.
- From financial losses.
- Cargo insurance.
- In case of illness.
- Aircraft.
- From natural disasters and fires.
- Civil liability of drivers of vehicles.
- And so on.
Insurance has 4 main industries, including several sub-sectors.
Enterprise Risk Insurance. This may include loss of income (risk when using new technologies, equipment, unrealized benefits due to a canceled transaction, damage from equipment downtime, etc.). This industry is further divided into:
- direct loss risk insurance;
- as well as indirect losses.
Property type of insurance. The object of this industry are tangible objects (housing, car, valuables), property insurance has the following sub-sectors:
- property insurance of citizens;
- public and cooperative organizations;
- collective farms;
- tenants
- state farms;
- state enterprises.
Liability Insurance. This industry includes liability insurance to fulfill contractual conditions, to compensate for damage. So, if the insured has caused damage to any entity, then the insurer will compensate for this damage. Liability insurance sub-sectors include:
- damage insurance;
- debt insurance.
Life standard insurance for citizens. In this industry, the object is the life, ability to work, health of the insured. Sub-sectors related to this industry:
- personal insurance of citizens;
- social insurance of employees, workers, collective farmers;
- pension and life insurance.
The guiding principle by which insurance is classified is the partial inclusion of each subsequent link in the previous one. There are exactly 2 forms of insurance: voluntary and compulsory. These forms cover all links. The state establishes compulsory insurance. This occurs in cases where the need for compensation for damage has not only the subjective interests of the affected person, but also affects the interests of the whole society.
The classification of insurance can also be based on the areas of activity of the insurer: domestic market, foreign market, mixed insurance market.