The cover abolishes or limits the burden of certain types of random events. These events can be negative: damage to health or destruction of property. They can also be positive: the birth of a child – but it is associated with increased financial needs. For one person, sme insurance Singapore the financial costs of such events can be very severe. Thanks to the cover company, which collects premiums from a number of citizens and pays compensation only to those precious by the damage, the costs are spread.
The basic function of insurance is prevention, i.e., prevention of random events. Prevention of damage is one of the policyholder’s obligations – his negligence or willful damage causes the refusal to pay the benefit. An example would be the defeat of discounts on required third party car insurance after the fault of the insured having to pay benefits to the injured party. The last purpose of sme insurance singapore is for financial purpose. There are a lot of positive effects on insurance risk financing. These are: eliminating worries related to the loss or the occurrence of sudden, increased financial needs, financial protection of relatives in the event of the insured’s death, financial certainty and stability, increasing financial credibility, or releasing funds that would be intended for self-coverage of compensation. The end of sure types of life insurance policies allows you to build up savings through investment funds. The funds collected in this way can be used as collateral for income in old age, mortgage, or future offspring.