Insurance is considered as an integral part of any developed society. The size of this sphere in this case is a significant part of the country's GDP. To understand this topic well, you need to know what its basic concepts, insurance principles are, and also have an idea about their implementation and application. And all this we will study in the framework of this article.
general information
Before studying the principles of insurance, we need to understand the essence of this field of activity. What does she mean? Under the insurance understand a certain combination of redistributive relations, through which special trust funds are formed. Their use under certain conditions allows participants to rely on compensation for the consequences of insurance risks. To understand the features of this sphere in the territory of the Russian Federation, it is necessary to familiarize yourself with the law "On the organization of
insurance business in the Russian Federation". For ease of operation, separate areas were identified, the work of which has its own characteristics. So, they distinguish between the principles of
compulsory insurance, voluntary, social, medical and so on. They often depend on the scope. But not all.
General insurance principles
They were bred during the formation and development of this sphere. So, there are basic principles of insurance:
- Equivalence . It implies maintaining a balance between the expected assistance of the injured party and the insurer.
- Solidarity . It implies the use of funds of part of the participants in order to compensate for the damage received by other people who took part in the formation of the insurance fund and need payments. Thus, all the negative consequences are distributed to as many people as possible.
- Returnability . All funds that were directed to the insurance fund will be used only for payments to its members. The best comparison here is with taxes that are distributed among all citizens of the state, and in some cases are spent on part of the foreign ones.
- Refund . A personโs insurance coverage is provided, which stipulates that the compensation will not be larger than the actual damage caused. In other words, if the house, which was estimated at two million rubles, was damaged, getting over this amount is almost impossible.
- Prevention . Insurers take all measures that depend on them, which may lead to a decrease in the likelihood of undesirable situations. This minimizes the amount of damage that can be caused to the property interests of a person.
As an example, we can say that the principles of medical insurance are fully consistent with the information provided in this part of the article. But not everything is so easy.
Insurance role
Before delving into the theoretical nuances and aspects, let's look at the functions that this sphere performs in the economic segment of our society:
- Compensatory . In other words, the damage is balanced due to the fact that financial resources are created that can allow affected entities to quickly resume their activities, while reducing harm to human health and life.
- Savings . The protection and improvement of people's living standards is ensured through the use of capitalization mechanisms in life insurance.
- Warning . They receive funding for activities that help reduce the likelihood of an insured event, which allows everyone to win: the fund, due to a decrease in the level of payments, and the population, thanks to the preserved health and life.
- Investment. The insurance sector contributes to the activation of short and long-term investments of funds that are in a temporary free position. Thanks to this, the funds act as a significant accumulator of unused money and direct them to the economy.
Of course, the functions presented here can take on a different level of detail, which depends on the tasks to be solved, organization, and much more.
Insurance relationship
They can have one essence and different content at the same time. Also, a different implementation is possible for them due to the variety of organizational forms. This is what was meant when it was previously said about distinguishable insurance principles. Let's consider what forms of relations can be:
- Mutual insurance. In this case, it is understood that within a certain group, participants on a non-profit and mutual basis are united in special societies that exist at the expense of their members.
- Commercial insurance. It provides compensation in case of a certain risk for a specific legal or natural person. Moreover, it will be received from a professional insurance organization. A condition for participation in this program is the payment of a certain fee.
- Social insurance. It is formed from contributions of employers and workers. The principles of social insurance provide for its universality in terms of social risks. To regulate its basic provisions, state legislation is used.
Interesting features
For us, the most interesting are the principles of compulsory social insurance. But in other countries, this is often not the case. This is largely due to their lower initial orientation to humans. Thanks to this, the phenomenon of self-insurance has spread. If we talk about a person, then this implies the deliberate saving of part of the money as savings or for their investment. In a way, such a term as self-insurance can be applied to the state or various organizations. In the first case, the government decides to create strategic reserves. They can be filled with both money and food, and other values. In the case of enterprises, this also means reserves, but much smaller in size.
Commercial and mutual insurance
What is their basis? The principles of voluntary insurance are used for them. We can confidently say that their implementation is possible only if there is a desire on the part of a person who acts as a client. In addition to the above provisions, insurance contracts are also used, which contain all the other features of the relationship, if they do not contradict the current legislation. There is a separate market where this specific product is sold. At the moment, we can safely say that these areas of insurance are an integral part of the economies of countries, which account for about 7% of the gross domestic product of the world.
And what about the Russian Federation?
The Russian Federation cannot yet boast of a significant development of the insurance market. So, it still makes up about 3% of the country's total GDP. This state of affairs is observed due to the lack of long traditions of the insurance market and regular crisis situations. The crisis of 2008 affected the development of this sphere most significantly, the consequences of which are felt to this day. The situation with a rather low level of confidence, when people believe that the safest place for money is under the mattress, also negatively affects the development of trends. Of course, such a statement, although it has the right to exist, is still erroneous. Given the presence of ever-increasing inflation, one cannot but pay attention to the fact that savings very quickly โeat upโ it. Therefore, care must be taken to minimize or even eliminate such a negative effect. And various economic instruments can provide all possible assistance in this.
Features of market development
To understand the processes occurring in the insurance business, one should be able to understand the criteria that the basic rules depend on, understand the methods and financial specifics of providing a certain service. Two concepts are mainly used here:
- Compensation for damage. In this case, the insured person receives a certain percentage of the value of the property. As an example, consider the following case. A factory was built. He was insured against fire at 100% of its value. In this case, if a fire occurs, all damage will be compensated. Of course, this will be preceded by an investigation of whether safety precautions were followed.
- Compensation of a certain amount. In this case, the victim is paid a certain amount of money, as agreed earlier. An example is the situation when a person broke his arm and he was paid 20 thousand rubles of compensation.
Conclusion
So, after reading the article, a clear understanding should be formed that the number of principles that are mandatory in any direction is quite small. But already in specific areas their own, special mechanisms can work. So, regarding social insurance, it can be noted that it is mandatory. This is one of the fundamental principles providing for the existence of a social contract, according to which all those who can work now provide previously working people. This topic is very interesting for further study.