DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : Syed Mohd. Akram
Designation : HCCP
Branch : DCCP
Institute : G.P.W (M), L.B. Nagar
Year/Semester : I Year
Subject : Business Organization
Subject Code : CCP104
Topic : Need and Importance of
Insurance
Duration : 50 Mts
Teaching Aids : PPTs and Animation

CCP104.124 1
Objective :

On completion of this period you

would be able to
 Explain the Need and importance of
Insurance

CCP104.124 2
Recap :

We know
 Meaning of Insurance
 Concept of Insurance
 Definition of
 Insurance
 Insurer
 Insured
 Premium

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Can you tell the Need of Insurance?

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 Insurance is needed where there is
uncertainty
 Insurance removes unforeseen risks

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Insurance Business is Concerned
With :

 Protection of economic value of assets

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Assets are Insured because they are
Exposed to Risk which is :

 Accidental

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Need of Insurance :
 If somebody dies prematurely, the family needs
are to be taken care of
 One has to maintain himself in old age
 There may be risk of Loss in business
 There may be theft or fire and stock is lost
 Goods sent on ship may be lost when the ship
drowns

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Need of Insurance :

 Needs are the basis of insurance

 Different plans of Insurance are designed to
take care of different needs
 The needs of different people vary depending
on the circumstance

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Need of Insurance :

 Continuation of business when financiers ask

for collateral security
 ٍSubstitute income when earning capacity
ceases because of old age

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Need of Insurance :

 Insurance is a vehicle to get protection against

uncertainties

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Summary :
 Insurance business is concerned with
Protection of economic value of assets
 Life and Assets are insured because they
are exposed to risk which is accidental
 Insurance removes different types of risk

CCP104.124 12
Quiz :

1. Insurance business is concerned with:

a) Buying and selling of goods
b) Removal of Risk
c) Giving Loans
d) None

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Quiz :

2. Assets are insured because they are

exposed to risk which is:
a) Accidental
b) Deliberate
c) Created
d) Regular

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Quiz :

3. Premium depends on:

a) Age
b) Age and plan
c) Age, plan and term
d) None

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Frequently Asked Questions :

1. Mention any four needs of Insurance.

2. What is the meaning of Insurance.
3. Explain the needs of insurance with
example.

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Assignment :

1. What is the concept of Insurance?

CCP104.124 17