Basic principles of insurance

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. In order to understand this topic well, it is necessary to know what its basic concepts, principles of insurance are, and also to have an idea of their implementation and application. And we will study all this in the framework of this article.

general information

Before we study the principles of insurance, we need to understand the essence of this field of activity. What does she mean? Under insurance we mean a certain set of relations of redistributive nature, thanks to which special purpose funds are formed. Their use under certain conditions allows participants to expect compensation for the consequences of the occurrence of insurance risks. In order to understand the specifics 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 the convenience of the operation, separate directions were singled out, the work of which has its own peculiarities. So, the principles of compulsory insurance, voluntary, social, medical and so on are distinguished. They often depend on the scope of action. But not all.

General principles of insurance

They were withdrawn during the formation and development of this sphere. So, there are basic principles of insurance:

1. Equivalence . Underneath is the imbalance between the expected assistance of the victim and the insurer.
2. Solidarity . It implies the use of the funds of some 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 negative consequences are distributed to the greatest possible number of people.
3. Returnability . All funds that were sent to the insurance fund will be used only for payments to its members. The best comparison here is with taxes, which are distributed among all citizens of the state, and in some cases are spent on a part of foreign.
4. Refund . The person's insurance protection is provided, which stipulates that the compensation will not be larger than the actual damage suffered. In other words, if the house, which was estimated at two million rubles, suffered, it is almost impossible to get more than this amount.
5. Prevention . Insurers take all measures depending on them, which can lead to a reduction in the likelihood of undesirable situations. This minimizes the amount of damage that can be done to the property interests of a person.

As an example, we can say that the principles of health insurance fully correspond to the information given in this part of the article. But not everything is so easy.

The role of insurance

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:

1. Compensatory . In other words, there is an equalization of the damage due to the fact that financial resources are created that can allow the affected entities to resume their activities quickly, while reducing the harm to people's health and life.
2. Savings . The protection and improvement of people's living standards is ensured through the use of capitalization mechanisms in life insurance.
3. Precautionary . They receive funding for the event, which helps to reduce the probability of occurrence of an insured event, which allows you to win everything: the fund, thanks to a reduction in the level of payments, and the population - thanks to the saved health and life.
4. Investment. The insurance sphere promotes the activation of short- and long-term investments of funds that are temporarily free. Thanks to this, the funds act as a significant accumulator of money that is not involved and direct them to the economy.

Of course, the functions presented here can take a different level of detail, which depends on the tasks to be performed, the organization and much more.

Insurance relations

They can have a single essence and different content at the same time. Also for them is possible and different implementation due to the variety of organizational forms. This is what was meant when earlier it was said about the distinctive principles of insurance. Let's consider what kind of relationship can be:

1. Mutual insurance. In this case, it is understood that within a certain group, participants on a non-commercial and reciprocal basis are united in special societies that exist at the expense of their members.
2. Commercial insurance. Provides compensation in the event of occurrence of a certain risk for a particular legal or natural person. And it will be obtained from a professional insurance organization. The condition of participation in this program is the introduction of a certain fee.
3. Social insurance. It is formed from contributions of employers and employees. The principles of social insurance provide for its universality in terms of social risks. To regulate its main provisions, state legislation is used.

Interesting features

We are most interested in the principles of compulsory social insurance. But in other countries things are often not so. This is largely due to their lesser initial orientation toward humans. Due to this, a phenomenon such as self-insurance has spread. If we talk about a person, then this means consciously deferring part of the money as savings or for their investment. In some ways, such a term as self-insurance can be attributed to the state or to various organizations. In the first case, the government decides to create strategic reserves. They can be filled with money, food, and other values. In the case of enterprises, this is also understood as reserves, but much smaller in size.

Commercial and Mutual Insurance

What lies at their basis? For them, the principles of voluntary insurance are used. One can confidently say that their realization is possible only if there is a desire on the part of the person who acts as a client. In addition to the above provisions, insurance contracts are also used, which contain all other features of relations, if they do not contradict the current legislation. There is a separate market where this particular product is sold. At the moment, we can safely say that these areas of insurance are an integral part of the economies of countries, accounting for about 7% of the world's gross domestic product.

And what about Russia?

The Russian Federation can not yet boast of a significant development of the insurance market. So, it is still about 3% of the total GDP of the country. This state of affairs is observed due to the absence of long traditions of the insurance market and regular crisis situations. The most significant impact on the development of this sphere was the crisis of 2008, the consequences of which are felt on this day. Negative on the development of trends affects the situation with a rather low level of trust, when people believe that the safest place for money is under the mattress. Of course, such a statement, although it has the right to exist, is still erroneous. Given the ever-increasing inflation, one can not help but notice that savings are very quickly "eaten away" by it. Therefore, care must be taken to minimize or even eliminate such a negative effect. And various economic instruments will be able to provide this help.

Features of market development

To understand the processes occurring in the insurance business, one should be able to understand the criteria on which the basic rules depend, to understand the methods and the financial specifics of the provision of a certain service. Here basically two concepts are used:

1. Compensation for damage. In this case, the insured person receives a certain percentage of the value of the property. As an example, we can consider the following case. A factory was built. He was insured against fire at 100% of its cost. In this case, in the event of an outbreak, all damage will be compensated. Of course, this will be preceded by an investigation into whether safety was observed.
2. Compensation of a certain amount. In this case, the victim is paid a certain amount of money, stipulated earlier. As an example, we can cite the situation when a person broke his arm, and 20 thousand rubles of compensation was paid to him.

Conclusion

So, upon reading the article, there should be a clear understanding that the number of principles that are mandatory in any direction is rather small. But already in specific spheres 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 that provide for the existence of a social contract, according to which all those who are now able to work provide previously employed people. This topic is very interesting for further study.