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CONCEPT OF RISK

Risk is the fundamental problem which insurance deals with. We are all living in a world of risk. Everything around us confronts us with its own measure of risk. Every activity we mentally or physically engaged ourselves in – has its own inherent measure of risk; every scientific or technological invention creates its own peculiar type of risk.

For example, any one who is travelling in a motor vehicle is exposed to the risk off motor accident. Anybody who indulges in reckless sexual relationship, with an opposite partner runs the grave risk of contracting AIDS and in addition the girls/women runs the of unwanted pregnancy. Anyone who builds a house runs the risk of the house being burnt down by fire of illness and possible loss of income. Everyone runs the damaging property belonging to other people or even injuring other people.

If any of these events occurs, we shall suffer great pain, possible loss of materials. Therefore, these risks threaten our     real existence and financial wellbeing. They are largely beyond our control.

Their presence constitutes obstacle to our economic security. The only happy things is that, there is a mechanism that when any of these event occur. This mechanism is Insurance

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