top 10 insurance companies
TRANSCRIPT
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 18
Top 10 Insurance companies
1 American International Group (AIG)
Country United States
Market Value $17224 billion
American International Group Inc (AIG) a world leader in insurance and financial
services is the leading international insurance organization with operations in more than
130 countries and jurisdictions AIG companies serve commercial institutional and
individual customers through the most extensive worldwide property-casualty and life
insurance networks of any insurer In addition AIG companies are leading providers ofretirement services financial services and asset management around the world AIGs
common stock is listed on the New York Stock Exchange as well as the stock
exchanges in Paris and Tokyo
2 AXA Group
Country France
Market Value $6612 billion
In 1980 AXA did not exist Over the next 20 years the Group would grow to become a
major international playerAXA pursues successfully its external growth strategyconsolidation of AXA existing activities with the acquisition of Oyaks 50 stake in AXA
Oyak 2nd Turkish insurer for 525 million dollars and penetration of high growth
potential markets with the acquisition of 100 of the 3rd Mexican insurer ING Seguros
(for an amount of 15 billion dollars) Today AXA is present in geographically diverse
markets with operations concentrated in Europe North America and Asia Pacific
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 28
3 Allianz Worldwide
Country Germany
Market Value $6555 billion
The Allianz Group is one of the leading integrated financial services providers worldwide
With nearly 155000 employees worldwide the Allianz Group serves approximately 75million customers in about 70 countries On the insurance side Allianz is the market
leader in the German market and has a strong international presence
4 Manulife Financial
Country Canada
Market Value $5052 billion
Manulife Financial is a leading Canadian-based financial services group serving millions
of customers in 22 countries and territories world-wide We provide financial protection
and wealth management products and services to individual and group customers in
Canada the United States and Asia These products and services include individual life
insurance group life and health insurance long-term care services pension productsannuities mutual funds and banking products We offer reinsurance services
specializing in life retrocession and property and casualty reinsurance and provide
investment management services with respect to the Companyrsquos general fund and
segregated fund assets and to mutual funds and institutional customers
5 Generali Group
Country Italy
Market Value $4545 billion
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 38
The Generali Group is one of the most significant
participants in the global insurance and financial products market The Group is leader in
Italy and Assicurazioni Generali founded in 1831 in Trieste is the Groups Parent and
principal operating Company
In recent years the Group has made a significant return to central-eastern European
markets and has set up offices in the principal markets of the Far East among which
China and India
6 Prudential Financial
Country United StatesMarket Value $3970 billion
Prudential Financial Inc (NYSEPRU) a financial services leader with approximately
$580 billion of Assets Under Management as of June 30 2009 has operations in the
United States Asia Europe and Latin America Leveraging its heritage of life insurance
and asset management expertise Prudential is focused on helping approximately 50million individual and institutional customers grow and protect their wealth
7 MetLife
Country United States
Market Value $3794 billion
MetLife Inc is a leading provider of insurance and other financial services to millions of
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 48
individual and institutional customers throughout the United States Outside the US
MetLife companies have direct insurance operations in Asia Pacific Latin America and
Europe
8 Aviva
Country United Kingdom
Market value $3310 billion
Aviva is one of the leading providers of life and pension products in Europe and are
actively growing our long-term savings businesses in Asia Pacific and the USA Their
main activities are long-term savings fund management and general insurance
9 Munich Re Group
Country Germany
Market Value $3099 billion
The Munich Re Group is one of the worldrsquos leading risk carriers Its business covers the
whole value chain in insurance and reinsurance
10 AEGON Counry Netherlands
Market Value $2640 billion
AEGON is an international business providing life insurance pensions and other long-
term savings and investment products to millions of customers around the world The
company has major operations in the United States the Netherlands and the United
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 58
Kingdom as well as other businesses in Asia the Americas and elsewhere in Europe
AEGON is listed on the stock exchanges of Amsterdam London New York and Tokyo
peril is the direct cause of the loss
If a house burns down then fire is the peril
the term perils to refer to ldquothe causes of lossrdquo If we wish to understand risk we
must first understand the terms ldquolossrdquo and ldquoperilsrdquo We will use both terms
throughout this text Both terms represent immediate causes of loss The
environment is filled with perils such as floods theft death sickness accidents
fires tornadoes and lightningmdashor even contaminated milk served to Chinese babies
We include a list of some perils below Many important risk transfer contracts (such
as insurance contracts) use the word ldquoperilrdquo quite extensively to define inclusions
and exclusions within contracts We will also explain these definitions in a legal
sense later in the textbook to help us determine terms such as ldquoresidual risk
retainedrdquo
Table 14 Types of Perils by Ability to Insure
Natural Perils Human Perils
Generally
Insurable
Generally Difficult to
Insure
Generally
Insurable
Generally Difficult to
Insure
Windstorm Flood Theft War
Lightning Earthquake Vandalism Radioactive contamination
Natural combustion Epidemic Hunting accident Civil unrest
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 28
3 Allianz Worldwide
Country Germany
Market Value $6555 billion
The Allianz Group is one of the leading integrated financial services providers worldwide
With nearly 155000 employees worldwide the Allianz Group serves approximately 75million customers in about 70 countries On the insurance side Allianz is the market
leader in the German market and has a strong international presence
4 Manulife Financial
Country Canada
Market Value $5052 billion
Manulife Financial is a leading Canadian-based financial services group serving millions
of customers in 22 countries and territories world-wide We provide financial protection
and wealth management products and services to individual and group customers in
Canada the United States and Asia These products and services include individual life
insurance group life and health insurance long-term care services pension productsannuities mutual funds and banking products We offer reinsurance services
specializing in life retrocession and property and casualty reinsurance and provide
investment management services with respect to the Companyrsquos general fund and
segregated fund assets and to mutual funds and institutional customers
5 Generali Group
Country Italy
Market Value $4545 billion
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 38
The Generali Group is one of the most significant
participants in the global insurance and financial products market The Group is leader in
Italy and Assicurazioni Generali founded in 1831 in Trieste is the Groups Parent and
principal operating Company
In recent years the Group has made a significant return to central-eastern European
markets and has set up offices in the principal markets of the Far East among which
China and India
6 Prudential Financial
Country United StatesMarket Value $3970 billion
Prudential Financial Inc (NYSEPRU) a financial services leader with approximately
$580 billion of Assets Under Management as of June 30 2009 has operations in the
United States Asia Europe and Latin America Leveraging its heritage of life insurance
and asset management expertise Prudential is focused on helping approximately 50million individual and institutional customers grow and protect their wealth
7 MetLife
Country United States
Market Value $3794 billion
MetLife Inc is a leading provider of insurance and other financial services to millions of
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 48
individual and institutional customers throughout the United States Outside the US
MetLife companies have direct insurance operations in Asia Pacific Latin America and
Europe
8 Aviva
Country United Kingdom
Market value $3310 billion
Aviva is one of the leading providers of life and pension products in Europe and are
actively growing our long-term savings businesses in Asia Pacific and the USA Their
main activities are long-term savings fund management and general insurance
9 Munich Re Group
Country Germany
Market Value $3099 billion
The Munich Re Group is one of the worldrsquos leading risk carriers Its business covers the
whole value chain in insurance and reinsurance
10 AEGON Counry Netherlands
Market Value $2640 billion
AEGON is an international business providing life insurance pensions and other long-
term savings and investment products to millions of customers around the world The
company has major operations in the United States the Netherlands and the United
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 58
Kingdom as well as other businesses in Asia the Americas and elsewhere in Europe
AEGON is listed on the stock exchanges of Amsterdam London New York and Tokyo
peril is the direct cause of the loss
If a house burns down then fire is the peril
the term perils to refer to ldquothe causes of lossrdquo If we wish to understand risk we
must first understand the terms ldquolossrdquo and ldquoperilsrdquo We will use both terms
throughout this text Both terms represent immediate causes of loss The
environment is filled with perils such as floods theft death sickness accidents
fires tornadoes and lightningmdashor even contaminated milk served to Chinese babies
We include a list of some perils below Many important risk transfer contracts (such
as insurance contracts) use the word ldquoperilrdquo quite extensively to define inclusions
and exclusions within contracts We will also explain these definitions in a legal
sense later in the textbook to help us determine terms such as ldquoresidual risk
retainedrdquo
Table 14 Types of Perils by Ability to Insure
Natural Perils Human Perils
Generally
Insurable
Generally Difficult to
Insure
Generally
Insurable
Generally Difficult to
Insure
Windstorm Flood Theft War
Lightning Earthquake Vandalism Radioactive contamination
Natural combustion Epidemic Hunting accident Civil unrest
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 38
The Generali Group is one of the most significant
participants in the global insurance and financial products market The Group is leader in
Italy and Assicurazioni Generali founded in 1831 in Trieste is the Groups Parent and
principal operating Company
In recent years the Group has made a significant return to central-eastern European
markets and has set up offices in the principal markets of the Far East among which
China and India
6 Prudential Financial
Country United StatesMarket Value $3970 billion
Prudential Financial Inc (NYSEPRU) a financial services leader with approximately
$580 billion of Assets Under Management as of June 30 2009 has operations in the
United States Asia Europe and Latin America Leveraging its heritage of life insurance
and asset management expertise Prudential is focused on helping approximately 50million individual and institutional customers grow and protect their wealth
7 MetLife
Country United States
Market Value $3794 billion
MetLife Inc is a leading provider of insurance and other financial services to millions of
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 48
individual and institutional customers throughout the United States Outside the US
MetLife companies have direct insurance operations in Asia Pacific Latin America and
Europe
8 Aviva
Country United Kingdom
Market value $3310 billion
Aviva is one of the leading providers of life and pension products in Europe and are
actively growing our long-term savings businesses in Asia Pacific and the USA Their
main activities are long-term savings fund management and general insurance
9 Munich Re Group
Country Germany
Market Value $3099 billion
The Munich Re Group is one of the worldrsquos leading risk carriers Its business covers the
whole value chain in insurance and reinsurance
10 AEGON Counry Netherlands
Market Value $2640 billion
AEGON is an international business providing life insurance pensions and other long-
term savings and investment products to millions of customers around the world The
company has major operations in the United States the Netherlands and the United
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 58
Kingdom as well as other businesses in Asia the Americas and elsewhere in Europe
AEGON is listed on the stock exchanges of Amsterdam London New York and Tokyo
peril is the direct cause of the loss
If a house burns down then fire is the peril
the term perils to refer to ldquothe causes of lossrdquo If we wish to understand risk we
must first understand the terms ldquolossrdquo and ldquoperilsrdquo We will use both terms
throughout this text Both terms represent immediate causes of loss The
environment is filled with perils such as floods theft death sickness accidents
fires tornadoes and lightningmdashor even contaminated milk served to Chinese babies
We include a list of some perils below Many important risk transfer contracts (such
as insurance contracts) use the word ldquoperilrdquo quite extensively to define inclusions
and exclusions within contracts We will also explain these definitions in a legal
sense later in the textbook to help us determine terms such as ldquoresidual risk
retainedrdquo
Table 14 Types of Perils by Ability to Insure
Natural Perils Human Perils
Generally
Insurable
Generally Difficult to
Insure
Generally
Insurable
Generally Difficult to
Insure
Windstorm Flood Theft War
Lightning Earthquake Vandalism Radioactive contamination
Natural combustion Epidemic Hunting accident Civil unrest
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 48
individual and institutional customers throughout the United States Outside the US
MetLife companies have direct insurance operations in Asia Pacific Latin America and
Europe
8 Aviva
Country United Kingdom
Market value $3310 billion
Aviva is one of the leading providers of life and pension products in Europe and are
actively growing our long-term savings businesses in Asia Pacific and the USA Their
main activities are long-term savings fund management and general insurance
9 Munich Re Group
Country Germany
Market Value $3099 billion
The Munich Re Group is one of the worldrsquos leading risk carriers Its business covers the
whole value chain in insurance and reinsurance
10 AEGON Counry Netherlands
Market Value $2640 billion
AEGON is an international business providing life insurance pensions and other long-
term savings and investment products to millions of customers around the world The
company has major operations in the United States the Netherlands and the United
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 58
Kingdom as well as other businesses in Asia the Americas and elsewhere in Europe
AEGON is listed on the stock exchanges of Amsterdam London New York and Tokyo
peril is the direct cause of the loss
If a house burns down then fire is the peril
the term perils to refer to ldquothe causes of lossrdquo If we wish to understand risk we
must first understand the terms ldquolossrdquo and ldquoperilsrdquo We will use both terms
throughout this text Both terms represent immediate causes of loss The
environment is filled with perils such as floods theft death sickness accidents
fires tornadoes and lightningmdashor even contaminated milk served to Chinese babies
We include a list of some perils below Many important risk transfer contracts (such
as insurance contracts) use the word ldquoperilrdquo quite extensively to define inclusions
and exclusions within contracts We will also explain these definitions in a legal
sense later in the textbook to help us determine terms such as ldquoresidual risk
retainedrdquo
Table 14 Types of Perils by Ability to Insure
Natural Perils Human Perils
Generally
Insurable
Generally Difficult to
Insure
Generally
Insurable
Generally Difficult to
Insure
Windstorm Flood Theft War
Lightning Earthquake Vandalism Radioactive contamination
Natural combustion Epidemic Hunting accident Civil unrest
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 58
Kingdom as well as other businesses in Asia the Americas and elsewhere in Europe
AEGON is listed on the stock exchanges of Amsterdam London New York and Tokyo
peril is the direct cause of the loss
If a house burns down then fire is the peril
the term perils to refer to ldquothe causes of lossrdquo If we wish to understand risk we
must first understand the terms ldquolossrdquo and ldquoperilsrdquo We will use both terms
throughout this text Both terms represent immediate causes of loss The
environment is filled with perils such as floods theft death sickness accidents
fires tornadoes and lightningmdashor even contaminated milk served to Chinese babies
We include a list of some perils below Many important risk transfer contracts (such
as insurance contracts) use the word ldquoperilrdquo quite extensively to define inclusions
and exclusions within contracts We will also explain these definitions in a legal
sense later in the textbook to help us determine terms such as ldquoresidual risk
retainedrdquo
Table 14 Types of Perils by Ability to Insure
Natural Perils Human Perils
Generally
Insurable
Generally Difficult to
Insure
Generally
Insurable
Generally Difficult to
Insure
Windstorm Flood Theft War
Lightning Earthquake Vandalism Radioactive contamination
Natural combustion Epidemic Hunting accident Civil unrest
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 68
Natural Perils Human Perils
Heart attacks Volcanic eruption Negligence Terrorism
Frost Fire and smoke
Global
E-commerce
Mold
Although professionals have attempted to categorize perils doing so is difficult We
could talk about natural versus human perils Natural perils are those over which
people have little control such as hurricanes volcanoes and lightningHuman
perils then would include causes of loss that lie within individualsrsquo control
including suicide terrorism war theft defective products environmentalcontamination terrorism destruction of complex infrastructure and electronic
security breaches Though some would include losses caused by the state of the
economy as human perils many professionals separate these into a third category
labeled economic perils Professionals also consider employee strikes arson for
profit and similar situations to be economic perils
We can also divide perils into insurable and noninsurable perils Typically
noninsurable perils include those that may be considered catastrophic to an insurer
Such noninsurable perils may also encourage policyholders to cause loss Insurersrsquo
problems rest with the security of its financial standing For example an insurer may
decline to write a policy for perils that might threaten its own solvency (eg nuclear
power plant liability) or those perils that might motivate insureds to cause a loss
Senario 1
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 78
When a person driving a car hits a pedisteian then the owener has to
pay the compensation to the pedisteian however the insurance
company of the car owener pays the componsation
Here First party car owener who pays the premium
Second party Insurance company
Third party claiment
Senario 2
When a car manufacturing company makes Insurance for some of
the engine components with some Insurance company
When a car user finds the defect in those engine parts he claims for
it
Then Insurance Company will replace or repair it
Here First party Car owener
Second party Insurance Company
Third party Car manufacturing company
Senario 3
When a worker gets injured while working in Company he can claim
for the componsation from the owener of the company
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged
832019 Top 10 Insurance Companies
httpslidepdfcomreaderfulltop-10-insurance-companies 88
The owener of the company pays the componsation from the
insurance comapny
Here Firstparty Company owener
Second party Insurance Company
Third party worker who has got injured while working
Senario 4 when a patient gets into trouble due to negligence of a
doctor then the doctor has to give the compansation to the patient
In this case the Insurance company of the doctor pays the
componsation to the patient
Here First party Doctor
Second party Insurance company
Third party Patient
Senario 5 when there are any damages due to LPG gas cylinder
brustIn this cases the Insurance company of the LPG supplier will
pay the componsation to the user
Here First party LPG gas supplier
Second party Insurance company
Third party user whose property has got damaged