Insurance products are The concept, process of creating and selling insurance products

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Insurance products are actions in the system of protecting various kinds of interests of individuals and legal entities for whom there is a threat, but it does not always happen. Evidence of the purchase of any insurance product is an insurance policy.

Insurance

The insurance system is the protection of various interests that are threatened. Also, this interest means a lot to a certain person. Separately, for each person the threat becomes small, but in the whole country, the amount of losses in case of loss of property becomes huge. Therefore, there is a need for insurance and the definition of an insurance product.

Every person in his life is faced with different situations, and they are not always positive. Many can threaten the life, he alth of him and his loved ones, property. The danger that a person recognizes and understands is expressed in the word "risk".

Risk is an event that can occur and has negative consequences. This event may occur due to the human factor andnatural conditions. There is insurance to manage the consequences. For example, a person insured his house for a specific period of time against the risk of "fire". During the term of the contract, a fire occurred, the client contacted the insurance company, and received funds based on the damage and the sum insured specified in the contract. If the insured event does not occur, then the client receives nothing.

What is insurance? The insurance system implies joint liability for damage caused to one. In this case, the general funds in the fund are used.

Functions

• Risky. Transfer of liability for damages to an insurance company by paying a premium under an insurance contract.
• Warning. Actions are taken to prevent an insured event and minimize the loss.
• Control. The formation of the fund is controlled, the use of funds only for their intended purpose.
• Savings. In life insurance, the client is offered insurance and savings services at the same time.

Insurance products

Insurance products are services provided by insurance companies for their customers, depending on the needs of the latter. Each insurance product has its own object (what will be insured), risk (the moment of occurrence of the event at which payment will occur), maximum and minimum amounts (cost), tariff (price), conditions and payment period. An insurance policy is proof that the customer has purchasedservice from an insurance company. This contract becomes a legal document, as it has information about the insured, the insurer, the subject of insurance, the conditions, rights and obligations of both parties.

Insurance premium (received amount from the client) is less than the sum insured. The difference in the amount and contribution helps most people to purchase insurance services, that is, the client in case of an insured event will receive more than he paid. But insurance companies will not incur large losses, since insured events will not occur with all insurers, respectively, everyone will not need to pay. The specifics of the insurance system is that there are always fewer insured events than the company's customers (except for force majeure).

It is impossible to determine in advance the number of insured events, and, therefore, to know the amount of insurance payments. Therefore, the balance of financial obligations between insurers and their clients is disturbed, it is uneven. But the level of tariffs for products should be average so that the client can purchase, and the insurance company can pay out to everyone in case of insured events and remain in the financial market. For this, base rates and adjustment factors are used individually for each insurance object. New insurance products appear due to the need to sell the service by the insurer, as the interests of clients change over time. The obligation to sell the service forces the price to be reduced, and the desire to make a profit forces it to increase. Therefore, there is an analysis of insuranceproducts, updating and changing them according to supply and demand.

Insurance classification

The grouping of insurance products depends on the object, amount, tariffs, risks, organization, etc. The name and quantity of products depends on the desire of consumers. Types of insurance products are divided into mandatory and voluntary forms by entering into the insurance market system.

Compulsory insurance

Compulsory insurance concerns every citizen (the object is related to the public interest), as it is determined by the state. Types of insurance:

• medical;
• civil servants;
• workers whose activities are associated with he alth risks;
• he alth and life of the crew of the aircraft;
• passengers;
• builders;
• auto liability insurance;
• fire fighting.

Voluntary insurance

Voluntary insurance is carried out at the request of the client and is divided into:

• private;
• property;
• civil liability insurance.

Who is eligible for insurance

Insurance products, insurance services can only be concluded by clients who have a legitimate interest in insuring a particular object. Interest is determined by the legal relationship of a person and a particular object.

The Civil Code defines a list of inadmissible interests for insurance:

• illegal;
• losses,received when playing the lottery, bet;
• losses of the insured person for the release of the hostage.

Property insurance

In case of property insurance, it is necessary to prove the interest in insuring the object with the help of contracts of ownership, lease, temporary storage, etc. But, if the property was insured, for example, not by the owner, then in the event of an insured event, the owner of the object will receive the payment.

Personal insurance

With personal insurance, each person can insure his life, he chooses the sum insured on his own, based on financial capabilities. In the Russian Federation, it is possible to insure other people, but only with the permission of the insured person himself. What are the interests in personal insurance? These are insurance products, the risks of which will be death, accidents, illness, disability under certain circumstances. Before you buy a policy, you need to clarify the list of risks. It differs from company to company as insurers develop their own products in accordance with the law.

In case of personal insurance, the beneficiaries are the persons specified in the contract. If they were not specified, then the heirs by law. During the term of the contract, the client has the right to change the beneficiary, as well as the terms of insurance, if the insurance company allows it.

Protection of bank cards

Insurance of bank cards is necessary for the security of the budget in case of various fraudulent actions of third parties. Most banks offerpurchase card insurance, but before that you need to clarify the risks. Main risks covered by the insurance program:

• Unauthorized withdrawal of money from the card due to loss, robbery, robbery, theft that occurred within 48 hours (that is, you need to contact the bank immediately after the event occurred).
• Theft of money that occurred within two hours after the customer received it from an ATM.
• Debiting money from the card account (which remained with the owner) within 48 hours before it was blocked.
• Recovering the key of a stolen card;
• Restoring documentation that was stolen along with the card;
• Issuing a card within two weeks, keeping the account.

Bank card insurance is voluntary. But with the development of technology, it is becoming popular with most customers, as many have encountered such a problem and understand its necessity.

Risks:

• robbery during withdrawal;
• Internet scam;
• use card after theft and loss;
• expenses for receiving the card after the loss will be returned.

Sale of insurance products

In the Russian Federation, insurance coverage is low compared to Western countries. The goal of insurance companies is to increase the number of consumers. To do this, it is necessary to take into account their needs and interests. The first step in achieving this goal is the development of insurance products. And here the first difficulties appear:

• client doesn't like terms;
• price;
• needs are different from supply.

For the successful implementation of the service, it is necessary to pay attention to the interest of the client. Without the desire to purchase a product, there will be no sale. Therefore, the launch of new products in insurance companies can take a long time, because you need to analyze the market. Clients differ in social status, living conditions, interests, standard of living. In most cases, in order for the client to be able and willing to purchase the product, they make an individual calculation, include the risks in the insurance contract that he needs. Therefore, the sum insured and the premium will be different for different customers.

There are also boxed products targeted for general sale. Their difference from the individual calculation is that there are no calculations here, the amounts are taken from the table. Such a system is easy to sell, as there is no need for knowledge in the calculations. What types of insurance are sold using the box view? These are insurance products aimed at a large number of buyers at an affordable price, for example, a house, apartment, civil liability. According to the table in the contract, the client himself chooses the sum insured and the premium is also determined.

Usually, large insurance companies treat product development in more detail, have a wide range. This helps most customers find the most suitable service for them. But there are difficulties for intermediaries in the sale (since you need to know the intricacies of each product,determine what kind of service is needed for a particular buyer).

Insurance products are promoted in two ways:

• Quick start, is to use all possible means of bringing information to the consumer (advertising, work of agents, representatives of insurance companies).
• A cautious launch, in which a service is gradually brought to market. That is, the insurer does not advertise, does not make efforts. Usually there is a sale in a certain territory, then it spreads further with a positive attitude of customers. Further, insurance companies are beginning to use advertising and other types of information.

Sales channels

To sell services, companies use several sales channels for insurance products. They are necessary in order to maximize the coverage of the population, depending on the social status, age, interests, lifestyle and financial situation. Multiple sales channels allow the company to acquire loyal customers.

Direct sales

In direct sales, an insurance company can control the process, change technology, use a call center, determine the wishes of customers on the spot. But there may be a loss of customers, as not everyone wants to go to the company's office. There are also high office costs.

Agent Sales

The advantages of agency sales are lower initial costs, high motivation of intermediaries to attract a buyer, convenience in choosing a place and time for a meeting, client contact with oneagent. The disadvantages in this type of sales are low control in the process of offering a product, possible errors, sometimes fraud, the likelihood of losing customers after the agent is fired.

Sales Brokers

The work of brokers is the most professional, plus for the company is the ability to sell services where there is no way to sell the product in another way. Also, brokers are engaged in the sale of complex products and for large amounts. But the minus for the insurer will be a high remuneration for the broker, the likelihood of the latter working simultaneously for several companies, errors in contracts are also possible. In insurance cases, mistakes are of great importance. Since an error can lead to non-payment to the insured, therefore, in the future, the client will consider this insurance company not professional and will not apply there anymore.

What is insurance? This is an opportunity for a person in various situations requiring financial assistance to protect himself, loved ones, property. Various events occur in people's lives, they can be pleasant and not very good. For example, illnesses, deaths, fires, natural disasters, accidents, the birth of children, weddings, buying property, vacations. So that each event does not bring big costs, you can prepare in advance by choosing the most advantageous offer for yourself.