Functions

Basically, it has two functions, viz, Primary and Subsidiary Functions.

-Primary Functions
Act of assessing the risk and minimizing financial risk using remedial measures to protect from loss immediately is the primary functions. Some of the primary functions are:
1. To provide assurance: Financial risk is unpredictable factor, so we can't assess the amount of loss which may take place in future. Insurance provides assurance by the agreement of compensating loss which takes place in future against premium.

2. To guarantee the protection: It guarantees protection against large and uncertain losses in return of nominal amount of premium.

-Subsidiary Functions
By the operation of insurance business, it performs various function to facilitate people are known are known as subsidiary functions.

1. Mobilization of capital: Insurance company collects the amount as premium from no. of customers and forms large amount of capital. It invests such capitals in the development.

2. Helps to increase the efficiency: Person who is insured feels more safe, active and enterprising.

3. Helps to minimize loss: In this modern age, insurance company makes the investigation to find out the tools to minimize the loss.