"Insurance contributes a lot to the general economic growth of the society by providing stability to the functioning of the process. 1. Provide safety and security: Insurance provides financial support and reduces uncertainties in business and human life. It provides safety and security against particular events. There is always a fear of sudden loss. Insurance provides a cover against any sudden loss. 2. Generates financial resources: Insurance generates funds by collecting premiums. These funds are invested in government securities and stock. These funds are gainfully employed in the industrial development of a country for generating more funds and utilised for the economic development of the country. 3. Life insurance encourages savings: Insurance does not only protect against risks and uncertainties but also provides an investment channel too. Life insurance enables systematic savings due to the payment of regular premiums. 4. Promotes economic growth: Insurance generates a significant impact on the economy by mobilizing domestic savings. Insurance turns accumulated capital into productive investments. Insurance enables to mitigate loss, financial stability and promotes trade and commerce activities that result in economic growth and development. 5. Medical support: Medical insurance is considered essential in managing risk in health. Anyone can be a victim of critical illness unexpectedly. And rising medical expenses are of great concern. 6. Spreading of risk: Insurance facilitates the spreading of risk from the insured to the insurer. The basic principle of insurance is to spread risk among a large number of people. 7. Source of collecting funds: Large funds are collected by way of premium. These funds are utilised in the industrial development of a country, which accelerates economic growth."

Abhijith S

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