Insurance:– There are two parties to a contract of insurance one is insurer. The other is the insured or assured. Insurer in consideration of premium agrees to make good the loss suffered by the insured against a specific risk .He agrees to compensate the insured or his Beneficiaries on the happening of a specified event such as an accident or death.

Policy:- The document laying down the terms of the contract of insurance is called policy. But a policy is not the contract itself. It is only the proof of the contract.

Subject Matter of Insurance:- The thing or property which is insured called the subject- Matter of insurance. It may be insured against loss arising from uncertain events, ,may be in the form of destruction of, or damage to the property or death or disablement of a person.

Different type of insurance products available to manage risk:-

1. Term life insurance or basic life insurance:-
2. Fire Insurance: - A fire insurance policy is a contract under which the insurer agrees in consideration of premiums to pay the loss or damage caused by fire during a specified period. In case of loss the assured can claim from the insurer the actual amount of loss or the maximum amount specified in the contract whichever is less.
3. Marine insurance:- Marine insurance that Branch of insurance which Relates to ships & their cargoes. Contract of Marine insurance is a contract under which the insurance indemnifies the insured against marine losses that is commerce on the sea.
4. Property – liability insurance Today its products include commercial property homeowners and automobile Each covers against loss of property and liability. .

Insurance is not gambling : Insurance involves the determination of the profitability of risks covered by it . A contract of insurance is performed only when there is some loss to the assured from a specified risk or from the happening of a specified event both of which in the very nature of things are in certain . In the initial stages insurance was only regarded as gambling .It is also described as all contract on speculation.

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