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Lecture notes, cheat sheets
Insurance. Cheat sheet: briefly, the most important
Directory / Lecture notes, cheat sheets Table of contents
1. THE CONCEPT OF INSURANCE. INSURANCE FUND Insurance is a relationship to protect the property interests of individuals and legal entities in the event of the occurrence of certain events (insured events) at the expense of monetary funds formed from the insurance premiums (insurance premiums) paid by them. The material embodiment of the economic category of insurance protection is insurance fund - a set of allocated (reserved) natural reserves of material goods. Historically, the natural insurance fund was the first organizational form of the material embodiment of the economic category of insurance protection. The insurance fund received a new quality in connection with the allocation of a specific commodity - money - from commodity circulation. The appearance of money freed the insurance fund from a mass of technical inconveniences associated with its natural-material content, opened up new opportunities for it. First of all, thanks to the monetary form, in which the insurance fund also began to be created, its resources could be quickly converted into any use value necessary to compensate for the damage that had occurred. The monetary form of the insurance fund allowed it to turn from an element serving intra-industry economic turnover into a means of influencing and guaranteeing the development of inter-industry economic turnover. The need for insurance protection, realized by a person and society as a whole, formed insurance interests through which certain insurance relations began to take shape. The content of insurance relations covered the formation and use of the resources of the insurance fund, regardless of the specific form of its organization. As society developed, these relations received civil law consolidation, which in turn made it possible to regulate them by legal methods. A powerful impetus to the organization of insurance protection was the social division of labor, the development of handicraft production and the separation of trade into an independent industry. The growth of cities, the development of handicraft production, trade, especially international trade associated with increased risk and the use of money loans, required proper insurance coverage. In this regard, credit and insurance were closely interrelated. The insurance of the borrower's property transferred to the creditor secured by a loan (marine loans) brought to life a special group of professionals - insurers, or underwriters, in whose hands the resources of the insurance fund were concentrated. The operational management of the resources of the insurance fund by insurers objectively required them to assess the insurance risk, based on the analysis of facts and circumstances, their accumulation, generalization and systematization. 2. WAYS OF FORMATION OF INSURANCE FUNDS. ESSENCE OF INSURANCE The history of public relations has developed three main forms of organization of the insurance fund. 1. Centralized insurance (reserve) funds, created at the expense of budgetary and other public funds. The purpose of their formation is to ensure the implementation of certain types of compulsory insurance, compensation for damage from natural disasters and large-scale accidents. The formation of such funds is carried out both in kind and in cash. State insurance (reserve) funds are at the disposal of the government. 2. self-insurance as a system for the creation and use of insurance funds by business entities and people. In this case, the risk remains with the insured himself. In self-insurance, decentralized insurance funds are created in kind and in cash. They are designed to overcome temporary difficulties in the activities of an individual organization or individual. The main source of formation of decentralized insurance funds is the income of this enterprise or individual. The procedure for using the funds of the insurance fund in terms of self-insurance is provided for in the charter of an economic entity. 3. Own insurance as a system for the creation and use of funds of insurance organizations at the expense of insurance premiums of parties interested in insurance. The funds of these funds are used to compensate for the resulting damage in accordance with the terms and conditions of insurance. The insurance fund of the insurer is created by a large circle of its participants, who act as policyholders. The formation of the fund takes place in a decentralized manner, since insurance premiums are paid by each insured separately. It has only monetary form. At the same time, the loss of one insured is distributed among all participants in the creation of the insurance fund, which leads to its great maneuverability and acceleration of the turnover of insurance reserves. Essence of insurance. Compensation for damage caused by the manifestation of destructive contradictions from the interaction of the forces of nature and society gives rise to the need to establish certain relationships between people to prevent, overcome and limit the destructive consequences of natural disasters. These objective relations of people to ensure a continuous and uninterrupted production process, to maintain the stability and sustainability of the achieved standard of living together constitute the economic category of insurance protection. 3. FEATURES AND FUNCTIONS OF INSURANCE Specificity economic category of insurance is determined the following signs: the presence of an insured risk (and the criterion for its assessment); • the random nature of the onset of a natural disaster or other manifestation of the destructive forces of nature; • objective need for damages; - the presence of redistributive relations in space and time; • formation of the insurance community from among the insurers and insurers; - Expression of damage in kind or monetary form; • implementation of measures to prevent and overcome the consequences of a particular event; • repayment of insurance payments; • self-sufficiency of insurance activity. Insurance arose and developed as a result of the economic need to protect a person and his property from accidental dangers. Despite the random nature of a natural disaster or other destructive event, it became possible to predict them scientifically. It became possible with a high degree of certainty to predict the possible amount of damage in natural and monetary forms. Thanks to scientific foresight, the insurer could consciously implement measures to prevent the adverse consequences of the insured risk. Prevention measures (ie prevention of possible damage in the future), taken by the insurer, allow him to optimize the resources of the insurance fund and often use them as a source of investment. Insurance has become one of the specific forms of insurance protection for social production and the organization of an insurance fund. Insurance - this is a way to compensate for losses suffered by an individual or legal entity by distributing them among many persons (insurance aggregate). Losses are reimbursed from the funds of the insurance fund, which is administered by the insurance organization (insurer). Objective need for insurance is due to the fact that losses sometimes arise as a result of destructive factors that are not at all under the control of a person (elemental forces of nature), in any case they do not entail anyone's civil liability. In such a situation, it may be impossible to recover damages from anyone, and they "settle" in the property area of the victim himself. A pre-established insurance fund can be a source of compensation for damages. Insurance functions. The economic essence of insurance corresponds to its functions, expressing the social significance of this category. The main one is risky function, since the insurance risk as the probability of damage is directly related to the main purpose of insurance to provide financial assistance to victims. Warning the function is aimed at financing, at the expense of a part of the insurance fund, measures to reduce insurance risk. Savings function: in case of saving sums insured with the help of life insurance in connection with the need for insurance protection of the achieved family income. control the function of insurance provides for the strictly targeted formation and use of the insurance fund. 4. INSURANCE IN A MARKET ECONOMY The transition to a market economy ensures a significant increase in the role of insurance in social reproduction, significantly expands the scope of insurance services and the development of an alternative to state insurance. With the command-administrative system of managing the national economy, the dominant role of state property and the weak economic responsibility of managers and labor collectives for its safety, insurance could not take its rightful place in the economy and social relations. The development of market relations, when the commodity producer begins to act at his own peril and risk, according to his own plan and bears responsibility for this, enhances the role and importance of insurance. At the same time, along with the traditional purpose - to provide protection against natural disasters (earthquakes, floods, storms, etc.), random events of a technical and technological nature (fires, accidents, explosions, etc.) - insurance is increasingly beginning to provide protection in the event of losses from various criminogenic phenomena (theft, robbery, vehicle theft, etc.). Enterprises and organizations of various forms of ownership, which are insurers, feel the need not only to compensate for damage caused by the loss or damage to fixed assets and working capital, but also to compensate for economic (entrepreneurial) risks. Today, it is customary to single out two main areas of insurance for these risks: insurance of the risk of direct and indirect losses. To direct Losses can include, for example, losses from shortfall in profits, losses from equipment downtime due to shortages of raw materials, materials and components, strikes and other objective reasons. indirect losses are lost profits, bankruptcy of the enterprise, etc. The changes also affect the sphere of property and personal insurance of citizens, which is directly related to the economic interests of the population. The ratio of long-term and short-term insurance contracts, the combination of risk, precautionary and savings insurance conditions, the level of bank interest on the reserve of contributions under life insurance contracts, taking into account price trends and the implementation of anti-inflationary measures with the transition to a market economy inevitably become the subject of insurance policy. The supply of insurance services is increasing. Gradually formed the insurance market. Priority is given to voluntary types of insurance, although in certain areas, compulsory insurance is retained or even introduced (for example, medical, insurance of military personnel against accidents, etc.). In a market economy, insurance is, on the one hand, a means of protecting business and people's well-being, and on the other hand, an income-generating activity. The sources of profit for an insurance organization are income from insurance activities, from investments of temporarily free funds in objects of production and non-production areas of activity, shares of enterprises, bank deposits, securities, etc. 5. INSURED. INSURERS. INSURED PERSON. BENEFICIARY Insured recognized as legal entities and capable individuals who have concluded insurance contracts with insurers or who are policyholders by virtue of law. Policyholders have the right to conclude insurance contracts with insurers for third parties in favor of the latter (insured persons). When concluding insurance contracts, policyholders have the right to appoint individuals or legal entities (beneficiaries) to receive insurance payments under insurance contracts, and also to replace them at their own discretion before the occurrence of an insured event. Insurers recognized as legal entities of any organizational and legal form provided for by the legislation of the Russian Federation, created to carry out insurance activities (insurance organizations and mutual insurance companies) and received, in accordance with the procedure established by law, a license to carry out insurance activities in the territory of the Russian Federation. Legislative acts of the Russian Federation may establish restrictions on the establishment by foreign legal entities and foreign citizens of insurance organizations on the territory of the Russian Federation. The subject of direct activity of insurers cannot be production, trade and intermediary and banking activities. Insured person. This is a person in whose life an insured event must occur, directly related to the person or circumstances of his life (personal insurance) or affecting the safety of his property rights and property (property insurance). In insurance, the construction of a contract in favor of a third party is often used, in which an independent right to claim the insurer for the payment of the sum insured arises not from the party to the contract - the insured, but from the third party - beneficiary. The insurer may raise objections to a third party arising from improper performance of the insurance contract by the policyholder. In most cases, the law provides for the individualization of the beneficiary in the insurance contract. As a rule, for the individualization of the beneficiary, the name of the legal entity or the name of the citizen is indicated, however, in some cases, the conditions under which this or that person becomes the beneficiary. In particular, the legislator points out that the liability insurance contract for causing harm is concluded in favor of persons who may suffer such harm. At the same time, the beneficiary cannot be replaced by another person after he has fulfilled any of the obligations under the insurance contract or has submitted a claim to the insurer for payment of compensation or the sum insured. 6. INSURANCE AGENTS AND BROKERS. OBJECTS OF INSURANCE. INSURANCE RISK, CASE, AMOUNT, DAMAGE insurance agents - These are individuals or legal entities acting on behalf of the insurer and on his behalf in accordance with the powers granted. insurance brokers - these are legal entities or individuals duly registered as entrepreneurs, carrying out insurance intermediary activities on their own behalf on the basis of instructions from the insured or insurer. objects insurance are property interests that do not contradict the legislation of the Russian Federation and are related to: - with life, health, ability to work and pensions of the insured or the insured person (personal insurance); - with possession, use, disposal of property (property insurance); - with compensation by the insured for the harm caused by him to the person or property of an individual, as well as the harm caused to a legal entity (liability insurance). insurance risk is the anticipated event for which insurance is provided. An event considered as an insured risk must have signs of probability and randomness of its occurrence. Insured event is an event that has taken place, provided for by the insurance contract or the law, upon the occurrence of which the insurer's obligation arises to make an insurance payment to the insured, the insured person, the beneficiary or other third parties. Sum insured is the amount of money specified in the insurance contract or established by law, on the basis of which the amounts of the insurance premium and insurance payment are determined, unless otherwise provided by the contract or legislative acts of the Russian Federation. Insured damage - this is the cost of the completely lost or depreciated part of the damaged property according to the insurance assessment. The amount due to the insured is called the insurance indemnity (in personal insurance - the sum insured). Insurance systems. Insurance coverage systems are methods for calculating insurance compensation in accordance with the conditions of insurance. There are three systems of insurance coverage: • proportional liability; • first risk system; • ultimate responsibility. Proportional liability: the damage incurred in the insured property shall be indemnified in a share equal to the ratio of the sum insured to the value of the insured property. First risk liability - all losses within the sum insured are compensated in full. Limit liability - losses are compensated within firmly established limits. In this case, the initial level of damage to be compensated and its maximum value are determined. 7. INSURANCE CONTRACT. INSURANCE CERTIFICATE Insurance contract is an agreement between the policyholder and the insurer, by virtue of which the insurer undertakes, in the event of an insured event, to make an insurance payment to the policyholder or another person in whose favor the insurance contract is concluded, and the policyholder undertakes to pay insurance premiums on time. The insurance contract may also contain other conditions determined by agreement of the parties, and must comply with the general conditions for the validity of the transaction provided for by the civil legislation of the Russian Federation. In order to conclude an insurance contract, the policyholder shall submit to the insurer a written application in the prescribed form or declare in a clearly acceptable way his intention to conclude an insurance contract. The insurance contract shall enter into force from the moment the policyholder pays the first insurance premium, unless otherwise provided by the contract or law. The fact of concluding an insurance contract may be certified by an insurance certificate (policy, certificate) transferred by the insurer to the insurant with the insurance rules attached. The insurance certificate must contain: • Title of the document; • name, legal address and bank details of the insurer; - surname, name, patronymic or name of the policyholder and his address; • indication of the object of insurance; - the amount of the sum insured; • indication of the insured risk; • the amount of the insurance premium, the terms and procedure for its payment; • contract time; • the procedure for changing and terminating the contract; • other conditions as agreed by the parties, including additions to the insurance rules or exclusions from them; • signatures of the parties. Grounds for refusal of the insurer to make an insurance payment: - intentional actions of the policyholder, the insured person or the beneficiary, aimed at the occurrence of an insured event; - commission by the policyholder or the person in whose favor the insurance contract is concluded, an intentional crime that is in a direct causal relationship with the insured event; - communication by the insured to the insurer of deliberately false information about the object of insurance; - receipt by the insured of the appropriate compensation for damage under property insurance from the person guilty of causing this damage; - other cases stipulated by legislative acts. The terms of the insurance contract may provide for other grounds for refusing an insurance payment, if this does not contradict the legislation of the Russian Federation. The decision to refuse an insurance payment is made by the insurer and communicated to the insured in writing with reasons for the refusal. 8. RIGHTS AND OBLIGATIONS OF THE PARTIES TO THE INSURANCE CONTRACT The insurer is obliged: - familiarize the insured with the rules of insurance; - in the event that the policyholder takes measures that reduce the risk of an insured event and the amount of possible damage to the insured property, or in the event of an increase in its actual value, renegotiate the insurance contract at the request of the policyholder, taking into account these circumstances; - in the event of an insured event, make an insurance payment within the period established by the contract or law. Otherwise, the insurer shall pay the policyholder a fine in the amount of 1% of the amount of the insurance payment for each day of delay; - reimburse the expenses incurred by the insured in the event of an insured event to prevent or reduce damage to the insured property, if the reimbursement of these expenses is provided for by the insurance rules. At the same time, the specified expenses in the part exceeding the amount of the damage caused are not subject to compensation; - not to disclose information about the insured and his property status, except as provided by the legislation of the Russian Federation. Obligations of the insured: - timely payment of insurance premiums; - notification to the insurer when concluding an insurance contract of all circumstances known to the insured that are important for assessing the insured risk, as well as about all insurance contracts concluded or being concluded in relation to this object of insurance; - taking the necessary measures to prevent and reduce damage to the insured property in the event of an insured event; - informing the insurer about the occurrence of an insured event within the time limits established by the insurance contract. The insurance contract may also provide for other obligations of the parties. In some cases, the replacement of the insured in the insurance contract may be provided. The contract defines the procedure and conditions insurance payment. The insurance payment is made by the insurer in accordance with the insurance contract or the law on the basis of the application of the insured and the insurance certificate (emergency certificate). The insurance act is drawn up by the insurer or a person authorized by him. If necessary, the insurer requests information related to the insured event from law enforcement agencies, banks, medical institutions and other enterprises, institutions and organizations that have information about the circumstances of the insured event, and also has the right to independently determine the causes and circumstances of the insured event. Legal entities are obliged to provide insurers, upon their request, with information related to the insured event, including information constituting a trade secret. At the same time, insurers are responsible for their disclosure in any form, with the exception of cases provided for by the legislation of the Russian Federation. 9. TERMINATION OF INSURANCE CONTRACT Termination of the insurance contract occurs in the following cases: - expiration date; - fulfillment by the insurer of obligations to the insured under the contract in full; - non-payment by the insured of insurance premiums within the terms established by the contract; - liquidation of the insured, which is a legal entity, or death of the insured, which is an individual, if the contract does not provide for the replacement of the insured in these cases; - liquidation of the insurer in accordance with the procedure established by the legislative acts of the Russian Federation; - adoption by the court of a decision to recognize the insurance contract as invalid; - in other cases stipulated by the legislative acts of the Russian Federation. The insurance contract may be terminated early at the request of the insured or insurer, if it is provided for by the terms of the insurance contract, as well as by agreement of the parties. The parties are obliged to notify each other of the intention to terminate the insurance contract early at least 30 days before the expected date of termination of the insurance contract, unless the contract provides otherwise. In case of early termination of the insurance contract at the request of the insured, the insurer shall return to him insurance premiums for the unexpired term of the contract, minus the costs incurred; if the policyholder's claim is due to the insurer's violation of the insurance rules, the latter shall return to the policyholder the insurance premiums paid by him in full. In case of early termination of the insurance contract at the request of the insurer, he returns to the policyholder the insurance premiums paid by him in full; if the insurer's claim is due to the insured's failure to comply with the insurance rules, then he shall return to the insured the insurance premiums for the unexpired term of the contract, minus the expenses incurred. The insurance contract is considered invalid from the moment of its conclusion in cases stipulated by the civil legislation of the Russian Federation. The insurance contract is also invalidated in cases of: - if it is concluded after the insured event; - if the object of insurance is property subject to confiscation on the basis of a valid court decision. The insurance contract is declared invalid by the court, arbitration or arbitration courts. 10. LOSS PERFORMANCE OF THE INSURED AMOUNT This indicator expresses the probability of damage in the form of the share of the total sum insured that is withdrawn from the insurance portfolio for the tariff period due to the occurrence of an insured event and compensation for damage. The unprofitability of the sum insured is affected by three factors which are usually called elements of unprofitability: 1. Frequency of insured events: S: A. 2. The devastation of one insured event (the average number of objects affected as a result of one insured event): D:C. 3. Risk ratio - the ratio of the average insurance indemnity for one damaged object to the average amount of one insured object. In case of partial damage, it indicates the average degree of damage to one object: F×A/D×B, where A is the number of insured objects; B - sum insured of insured objects; D is the number of affected objects; F - the amount of insurance compensation paid. Thus: Q = C/A × D/C × (F × A)/(D × B) = F/B, where C is the number of insured events; Q - loss ratio of the sum insured. 11. INSURANCE INdemnity Upon the occurrence of an insured event, the mechanism of the insurance contract comes into force to determine and pay the amount of compensation to the insured or a third party in whose favor the contract is concluded. Insured event is an event that has taken place, provided for by the insurance contract or the law, upon the occurrence of which the insurer's obligation arises to make an insurance payment to the insured, the insured person, the beneficiary or other third parties. In the event of an insured event with property, the insurance payment is made in the form of insurance compensation, in the event of an insured event with the identity of the insured or a third party - in the form of insurance coverage. Insurance compensation cannot exceed the amount of direct damage to the insured property of the insured or a third party in the event of an insured event, unless the insurance contract provides for the payment of insurance compensation in a certain amount. In the event that the sum insured is lower than the insured value of the property, the amount of insurance indemnity is reduced in proportion to the ratio of the sum insured to the insured value of the property, unless otherwise provided by the terms of the insurance contract. In the event that the policyholder has concluded property insurance contracts with several insurers for an amount exceeding the total insured value of the property (double insurance), the insurance compensation received by him from all insurers for insuring this property cannot exceed its insured value. At the same time, each of the insurers pays insurance compensation in the amount proportional to the ratio of the insurance amount under the contract concluded by him to the total amount under all insurance contracts of the specified property concluded by this insured. The terms of the insurance contract may provide for the replacement of the insurance payment with compensation for damage in kind within the amount of the insurance indemnity. Insurance coverage is paid to the insured or a third party, regardless of the amounts due to them under other insurance contracts, as well as under social insurance, social security and in order to compensate for harm. At the same time, insurance coverage for personal insurance, due to the beneficiary in the event of the death of the insured, is not included in the composition of hereditary property. The main obligation of the insurer under the insurance contract is the implementation of the insurance payment upon the occurrence of an insured event. The insurer is obliged: - in the event of an insured event, make an insurance payment within the period established by the contract or law; - reimburse the expenses incurred by the policyholder in the event of an insured event to prevent or reduce the amount of damage caused to the insured property, if such expenses were necessary or were carried out to fulfill the instructions of the insurer. 12. DAMAGES AND PAYMENT OF INSURANCE COMPENSATION. ESTABLISHING THE FACT OF THE INSURED EVENT Determination by the insurer of the amount of damage and payment of insurance compensation includes three stages: • establishing the fact of an insured event; • determination of the amount of damage, insurance payment and drawing up an act on an insured event (insurance act); • insurance payment. Establishing the fact of an insured event. One of the most important obligations of the insured (beneficiary) in case of damage, destruction or theft of property is to file an application for an insured event in a timely manner. The conditions of insurance oblige the insured to declare the loss or damage to property, usually within 1-3 days, if this period has been violated, the insurer finds out the reasons for the delay. After receiving the application of the insured, which indicates when, where, under what circumstances and what property was lost or damaged, the compliance of the information provided with the terms of the insurance contract is checked. This check is carried out in order to establish whether the event is an insured event, with the occurrence of which the insurer has an obligation to make an insurance payment. First of all, you need to set whether the property was insured at the time of the event. Particular attention should be paid to this, since the treaty may not yet have entered into force. Next, you should check whether the event that occurred (for example, the destruction of property as a result of an earthquake) was included in the scope of insurance liability, i.e., in the list of natural disasters and other hazards (risks) against which insurance is carried out. The fact and cause of the occurrence of the event, as a result of which the damage was caused, must be confirmed required documents from relevant organizations. If the event that occurred was not provided for by the insurance contract, it is not an insured event, and the insurer is free from the obligation to compensate for the damage caused. It is also very important compare the place of loss or damage to property with its location (area of operation) specified by the insured at the conclusion of the insurance contract. Usually, the insurance company is liable regardless of the location of the property, but in relation to certain types of it (property received by the insured under a property lease agreement, accepted from other organizations, the public, household property, etc.), the loss or damage to property is recognized as an insured event only in those places which are indicated in the application for insurance and the insurance certificate (policy). At the same time, when applying to the insurer with an application for payment, the insured must prove your interest in the property, which was destroyed or damaged (trade bills of lading for the shipment and receipt of cargo, entries in property registers). 13. AMOUNT OF DAMAGE, INSURANCE PAYMENT AND PREPARATION OF AN INSURED EVENT ACT If the insurer recognizes the event as an insured event, an insurance claim is drawn up based on the application of the insured act of the established form about the loss (damage) of the insured property. An insurance act is not drawn up if, when checking the application, it is established that the loss or damage to property did not occur as a result of an insured event, or if, due to the delay in the notification, it is not possible to establish the fact and cause of the loss or damage to property, as well as the amount of its damage. In this case, the insurer and the policyholder are freeform document, which indicate only the reasons for the failure to draw up the named act. In accordance with the rules of insurance the insurance company is obliged to start drawing up the act no later than 3 days and complete this work within 5-10 days from the date of receipt of the application from the insured (beneficiary). The act contains information about the destroyed (damaged) property and its remains, and the appendices to the act contain calculations of the amount of damage and insurance compensation. Usually, the quantity and value of property available at the time of the disaster are determined according to accounting and reporting data and on the basis of primary receipts and expenditure documents (payment requests, invoices, waybills, etc.), inventory balances of unused materials. If accounting books, cards, primary documents are destroyed, the value of the property at the time of the disaster (fire, etc.) is determined on the basis of duly approved inventory reports of materially responsible persons, drawn up in connection with the insured event. In some cases, the quantity and value of property at the time of the disaster can also be determined by calculation, i.e., by the number and size of containers, by the number of remains of property, based on the volume of the premises in which the property was located, etc. But in any case the amount of damage should not include the value of property, the presence of which at the time of the fire was not proven by primary documents or documents drawn up after inspection of the remains of the property and the place of the insured event. Total damage for insurance of property and other risks is determined by the formula: Y \uXNUMXd P × I + C × T, where Y is the amount of damage; P - the value of the property according to the insurance assessment; I - the amount of depreciation of property at the time of the insured event; C - expenses for saving and putting property in order; T - the cost of residues suitable for building materials. 14. INSURANCE PAYMENT Insurance indemnity is paid in period established by the terms of insurance after the insurance company receives all the necessary documents and draws up an insurance act (accident certificate). In particular, in a life insurance contract, a period of payment of an insurance premium, a waiting period and a period of insurance payments are distinguished. Insurance premium payment period - this is the period specified in the life insurance contract, during which the policyholder is obliged to pay the insurance premium established by the contract. At the same time, it can be paid in a lump sum or in installments within the period established in the insurance contract, including until the moment of the event (possible insured event), upon the occurrence of which the insurer becomes liable for insurance payment. waiting period is established in life insurance contracts concluded with the condition that the insured person survives until the period specified in the insurance contract, and represents the period between the fulfillment by the insured in full of obligations to pay the insurance premium and the onset of the period of insurance payments. Period of insurance payments - this is the period during which the insurer's obligations to make insurance payments arise and are fulfilled. This period is set in the insurance contract. The amount of the insurance payment can be paid in a lump sum or in the form of an insurance annuity: urgent or life. For delay in payment due to the fault of the insurer, he must pay the policyholder a fine in the amount of 1% of the payable insurance indemnity for each day of delay. The amount of insurance compensation is transferred by the insurer in a non-cash form to the settlement account of the insured, and individuals can be paid in cash. All acts, calculations and other documents on the basis of which the insurance indemnity is paid are canceled with the appropriate stamp of the insurer indicating the date of payment. If corrections are made in the documents, they must be specified, certified by the persons who compiled these documents, and sealed with the seal of the insurer. If, after payment of the insurance indemnity, the stolen property is found, the policyholder is obliged to return to the insurer the insurance indemnity received for it, minus the cost of the necessary repairs or the cost of putting in order related to the theft. In case of failure to return the insurance indemnity within the established period, the insurer should file a claim in accordance with the established procedure. As you know, the insurer that paid the insurance indemnity transfers, within this amount, the right to claim that the insured has against the person responsible for the damage caused. Therefore, if the person responsible for the damage is indicated in the documents of the competent authorities, the insurer may, by way of subrogation, file a claim against this person. 15. INSURED RISK insurance risk is the expected event, in the event of which insurance is carried out, i.e. the risk is the object of insurance. An event considered as an insured risk must have signs of probability and randomness of its occurrence. Risk in insurance should be considered in several aspects: - as a specific phenomenon or a set of phenomena (an event or a set of events), upon the occurrence of which payments are made from the previously formed centralized insurance fund in kind or in cash; - in connection with a specific insured object. An event or a set of events is not considered abstractly, by itself - they should be correlated with the object accepted for insurance, where the risk is realized. Any risk has a specific object of manifestation. In our minds, risk is associated with this object. In relation to the object, risk factors are respectively manifested and studied. Analysis of the information received in combination with other measures makes it possible to prevent or significantly reduce the negative consequences of the implementation (implementation) of the risk; - the risk is associated with the probability of loss or damage to the object accepted for insurance. Probability acts as a measure of the objective possibility of the occurrence of a given event or a set of events that have a harmful effect. Any probability can be expressed as a proper fraction. With a probability equal to zero, it can be argued that this event is impossible. With a probability of one, there is a 100% guarantee that the event will occur. The lower the probability of risk, the easier and cheaper it is to arrange its insurance. Insurance is characterized by objective and subjective probabilities. Objective probability reflects the laws inherent in phenomena and objects in their objective reality. subjective reflects accidents that ignore an objective approach to reality, denying or not taking into account the objective laws of nature and society. In addition, risk can also be presented through logical probability, which is based on the knowledge of the laws of nature and society with the help of logical methods. Logical probability is used in the development and introduction of new types of insurance that do not have or almost do not have an information base of preliminary observation of the population. If the introduction of a new type of insurance was preceded by a preliminary collection and analysis of statistical data using the mathematical apparatus of the law of large numbers, then the result will reflect statistical probability. Risk analysis allows you to divide them into two big groups: insurance and non-insurance (not included in the insurance contract). The list of insurance risks is the volume of insurance liability under the insurance contract. It is expressed using the insurance amount of the contract. The price of risk in monetary terms is the tariff rate. 16. TYPES OF RISKS AND THEIR ASSESSMENT Various methods are used to assess risk in insurance practice. Method of individual assessments applies only to risks that cannot be compared with the average risk type. The insurer makes an arbitrary assessment reflecting its professional experience and subjective opinion. For method of averages characteristic is the division of individual risk groups into subgroups. Thus, an analytical base is created for determining the size by risk characteristics (for example, the book value of the insurance object, total production capacity, type of technological cycle, etc.). Percent Method represents a set of discounts and allowances (markups) to the available analytical base, depending on possible positive and negative deviations from the average risk type. One of the most difficult tasks for an insurer is to keep its tariff policy in line with predicted trends in risk development. To assess it in this insurance aggregate, it is especially important to have reliable information. When assessing risk, the following are distinguished: kinds: 1) risks that can be insured; 2) risks that cannot be insured; 3) favorable and unfavorable risks; 4) technical risk of the insurer. Insurance risks. The largest group consists of risks that can be insured. Insured risk is one that can be assessed in terms of the likelihood of an insured event and the quantitative extent of possible damage. The main criteria for considering the risk as insured: - the risk, which is included in the scope of the insurer's liability, must be possible; The risk must be random. The object in relation to which the insurance legal relationship arises is characterized by an unstable, temporary type of connection and should not be exposed to danger, which is known in advance to the insurer or the owner of the insurance object; - the random occurrence of this risk should be correlated with the mass of homogeneous objects. For this purpose, an appropriate statistical observation is organized, the analysis of the data of which makes it possible to establish an insurance premium adequate to the forecast; - the occurrence of an insured event, expressed in the realization of risk, should not be associated with the will of the insured or other interested person; - the fact of occurrence of the insured event is unknown in time and space; - an insured event should not have the dimensions of a catastrophic disaster, i.e. it should not cover a lot of objects within a large insurance population, causing mass damage; - the harmful consequences of the realization of the risk must be objectively assessed: they must be large enough and affect the interests of the insured (insurance interests). 17. RISK CLASSIFICATION Depending on the amount of liability of the insurer, risks are divided into individual and universal. For example, individual the risk is expressed in the insurance contract for a masterpiece of painting during transportation and exposure in case of acts of vandalism in relation to it. universal the risk that is included in the scope of the insurer's liability under most property insurance contracts is theft. A special group is made up of specific risks: anomalous and catastrophic. Anomalous: the value of which does not allow attributing the relevant objects to certain groups of the insurance population. Abnormal risks are higher and lower than normal. Below normal risk is favorable to the insurer and is covered under the normal terms and conditions of the insurance contract. Higher than normal risk is not always favorable for the insurer and is covered under the special conditions of the insurance contract. Catastrophic risks make up a significant group that covers a large number of insured objects or policyholders, while causing significant damage on an especially large scale. According to the international classification, catastrophic risks are divided into endemic (local) risks (which occur under the influence of meteorological factors and conditions) and risks under the influence of land quality (for example, soil erosion). Of exceptional importance in the work of the insurer is the definition of objective and subjective risks. Objective - express the harmful effect of uncontrolled forces of nature and other accidents on the objects of insurance, do not depend on the will and consciousness of a person. Subjective - are based on the denial or ignorance of an objective approach to reality; are associated with insufficient knowledge of the surrounding world in objective reality, depend on the will and consciousness of a person. In the general classification of risks, it is customary to distinguish between environmental, transport, political and special risks. Environmental risks are associated with environmental pollution and are due to the transformative human activity in the process of appropriation of material goods. Certain insurance interests due to environmental risks have led to the creation of an independent type of insurance that meets these interests. Transportation: are divided into hull and cargo risks. Risks Casco imply insurance of air, sea and river vessels, railway rolling stock and cars during movement, parking (downtime) and repair, cargo - insurance of goods transported by air, sea, river, rail and road transport. Political risks are associated with illegal actions from the point of view of international law, with activities or actions of governments of foreign states in relation to a given sovereign state or its citizens. Special risks involve insurance of transportation of especially valuable goods (precious stones, works of art, cash). 18. RISK MANAGEMENT Risk management in insurance is carried out in two stages: - preparatory, which involves comparing the characteristics and probabilities of the risk obtained as a result of its analysis and assessment. At this stage, an alternative is identified in which the magnitude of the risk remains socially acceptable. Priorities are set, i.e., a range of problems and issues requiring priority attention is identified. Thus, it becomes possible to rank the available options according to the principle of acceptability of the risk contained in them: the risk is fully acceptable, partially acceptable, not acceptable at all; - selection of specific measures to help eliminate or minimize the possible negative consequences of the risk. This stage includes the development of organizational and operational procedures of a preventive nature. For the insurer, this stage may consist in the preparation and issuance of specific recommendations to persons making or implementing risky decisions. One of the options for procedures and measures that allow timely response to the negative consequences of activities in a risk situation is a specially developed situational plan, containing prescriptions for what each person should do in a given situation, and a description of the expected consequences. Based on a situational plan, people who implement risky decisions get the opportunity to act quickly in adverse conditions, become more prepared to act in unforeseen situations. When managing risk, the insurer pays attention to the legal aspect. Legal support consists in the development and adoption of laws and by-laws that minimize or limit the risk. The acts should reflect the question of when and under what conditions the risk is justified, lawful and expedient. In practice, the following can be used main elements of the management system in risk situations: - identification of risk alternatives, its admission only within the limits of a socially acceptable level; - development of specific recommendations aimed at eliminating or minimizing possible negative consequences of the risk; - creation of special plans that allow people who implement decisions with risk or control this process to optimally act in a critical situation; - preparation and adoption of normative acts that help to implement the chosen alternative; - taking into account the psychological perception of risky decisions and programs. 19. METHODS AND STAGES OF RISK MANAGEMENT Based on the provisions of the stated theory, social practice has developed four methods of risk management: abolition, loss prevention and control, insurance, takeover. abolition is an attempt to eliminate risk. For the individual, this means not smoking, flying, etc.; for the company, this means that when releasing a product for sale, it is necessary to carefully consider how to make its use safe. Cancellation is an effective way to avoid losses. The problem is that eliminating risk eliminates profit. Loss prevention and control are expressed in measures to prevent the occurrence of insured events and limit the amount of losses in the event that a loss occurs. Insurance in terms of risk management, it means a process in which a group of individuals and legal entities exposed to the same type of risk invests in a company whose members are compensated in case of losses. The main idea of insurance is the distribution of losses among a large group of individuals and legal entities (insurance population) exposed to the same type of risk. Absorption consists in recognizing the loss of risk without distributing it through insurance. Risk management can be broken down into six stages: - goal definition. For an individual, a specific goal may include maintaining good health, maintaining a family's standard of living in the event of death or loss of income, insurance coverage for household goods, privately owned vehicles, etc. For an entrepreneur, the main goal is to ensure the existence of the company in unforeseen circumstances (fire, robbery, etc.); - clarification of the risk is expressed in the awareness of the risk by an economic entity or individual. Awareness of risk always takes place in the public environment and is based on public practice; - risk assessment - determination of its severity in terms of probability and magnitude of possible damage; - choice of risk management methods from the listed ones (elimination, loss prevention and control, insurance, absorption). The method is chosen depending on the type of risk. In practice, several methods of risk management are used; - application of the chosen method. If, for example, insurance is chosen as the risk management method, then the next step is to draw up an insurance contract (purchase an insurance policy). In addition to insurance, any risk management strategy includes a loss prevention and control program; - the results are evaluated on the basis of a well-established system of accurate information, which makes it possible to consider losses and the actions themselves to prevent them. 20. BASIC PRINCIPLES OF INSURANCE CLASSIFICATION The classification of insurance is a scientific system of its division into areas of activity, industries, sub-sectors and types, the links of which are arranged so that each subsequent link is part of the previous one. The insurance classification is based on two criteria: differences in the objects of insurance and in the amount of insurance liability. In accordance with this division, apply two classification systems: by objects of insurance and by type of danger. In a broader and more specific sense, the classification of insurance is a form of expressing differences in insurers and their areas of activity, objects of insurance, categories of policyholders, the amount of insurance liability and the form of insurance. In accordance with the Civil Code of the Russian Federation, property and personal insurance contracts are distinguished. Under a property insurance contract one party (the insurer) undertakes, for the fee stipulated by the contract (insurance premium), upon the occurrence of an event (insurable event) provided for in the contract, to compensate the other party (the policyholder) or another person in whose favor the contract was concluded (the beneficiary) for the losses caused by this event in the insured property or losses in connection with other property interests of the insured (to pay insurance compensation) within the amount specified by the contract (sum insured). Property interests can be insured under a property insurance contract: 1) the risk of loss (destruction), shortage or damage to certain property; 2) the risk of liability for obligations arising from causing harm to life, health or property of other persons, and in cases provided for by law, liability under contracts - the risk of civil liability; 3) the risk of losses from entrepreneurial activities due to breach of obligations by counterparties of the entrepreneur or changes in the conditions of this activity due to circumstances beyond the control of the entrepreneur. Under a personal insurance contract one party (the insurer) undertakes, for the fee stipulated by the contract (insurance premium) paid by the other party (the insured), to pay a lump sum or periodically stipulated by the contract (sum insured) in the event of harm to the life or health of the insured himself or another citizen named in the contract (insured person), reaching a certain age or the occurrence in his life of another event (insured event) provided for by the contract. The right to receive the sum insured belongs to the person in whose favor the contract is concluded. In the event of the death of a person insured under a contract in which other beneficiaries are not named, the heirs of the insured person are recognized as such. 21. INSURANCE POLICY. CLASSIFICATION BY INDUSTRY The form of the insurance contract must be in writing only (clause 1, article 940 of the Civil Code of the Russian Federation). The contract can be concluded by drawing up one document signed by both parties, or by the insurer handing over to the insured an insurance policy (certificate, certificate, receipt), signed only by the insurer (clause 2 of article 940 of the Civil Code). Insurance policy is a document confirming the conclusion of an insurance contract. He can be one-time - with its help, simple insurance transactions (with one item) are processed, and general - extending to several homogeneous property insurance operations (in relation to a group of items). There are specialized insurance organizations operating on the market, which are divided according to the form of ownership, insurance industries, and the scope of coverage of insurance risks in the form of compulsory and voluntary insurance. Industry classification. In foreign practice, an ordered system of types (classes) of insurance. In the EU countries, there is currently a unified classification of types of insurance established by EU Directive 73/239 / EEC. The goal is to assist in the formation of a single insurance market of the EU member countries. The object of insurance may be insured under one contract jointly by several insurers (co-insurance). At the same time, the contract must contain conditions that determine the rights and obligations of each insurer. The object of insurance is the material carrier of all features, including the economic interests of insurance. Insurance objects are divided into two classes: having value and not having value. On the basis of value in insurance, insurance industries are distinguished: property insurance, personal insurance, liability insurance, insurance of economic risks. The need to identify these four industries is typical for the Russian national insurance market. Such a classification is determined by the list of objects and risks subject to insurance. Private insurance - an industry in which the object of insurance relations are property interests related to the life, health, working capacity and pension provision of the insured or other insured person. Property insurance - an industry in which the object of insurance relations are property interests related to the possession, use and disposal of property. At the same time, not only the owners of property, but also other legal entities and individuals who are responsible for its safety, can be insurers. Liability Insurance - the insurance industry, where the object is liability to third parties (individuals and legal entities), whose person or property may be damaged (harm) due to any actions (inaction) of the insured. 22. CLASSIFICATION BY FORM OF ORGANIZATION According to the form of organization, insurance can be state, joint-stock, mutual, cooperative. Medical insurance and reinsurance are special organizational forms. State - organizational form, where the state acts as an insurer in the person of organizations specially authorized for this. The circle of interests of the state includes its monopoly on carrying out any or certain types of insurance (defined by the law on the status of insurance activities). Shareholder - a non-state organizational form, where private capital acts as an insurer in the form of a joint-stock company, the authorized fund of which is formed from shares (bonds) and other securities owned by legal entities and individuals, which allows, with relatively limited funds, to quickly deploy the effective work of insurance companies. Mutual - non-state organizational form, which expresses an agreement between a group of individuals, legal entities to compensate each other for future possible losses in certain shares according to the accepted conditions. It is implemented through a mutual insurance company, which is an insurance organization of a non-profit type, that is, it does not pursue the goals of making a profit from the established insurance company. Mutual Insurance Society acts as an association of individuals or legal entities created on the basis of a voluntary agreement between them for the insurance protection of their property interests. Each policyholder is a member of a mutual insurance society. cooperative - non-state organizational form, which consists in the conduct of insurance operations by a cooperative. Medical - a special organizational form of insurance activity. In Russia, it acts as a form of social protection of the interests of the population in the protection of health. The goal is to guarantee citizens, in the event of an insured event, receiving medical care at the expense of accumulated funds (including in the state and municipal healthcare systems) in the amount of partial or full compensation for the additional expenses of the insured, caused by the insured applying to medical institutions for medical services included in the medical program. insurance, and finance preventive measures. The subjects of health insurance are a citizen, an insured, an insurance medical organization (insurer), a medical institution (polyclinic, outpatient clinic, hospital, etc.). A special place in the system of insurance relations is occupied by reinsurance, i.e. insurance by one insurer of a part of its obligations to the insured from another insurer. Reinsurance is, in essence, secondary insurance, as it protects an insurance company that has taken a large risk and may not be able to compensate for the damage in the event of an insured event. 23. CLASSIFICATION BY TYPE OF INSURANCE The qualitative characteristics of objects accepted for insurance determine the type of insurance on the basis of homogeneous and heterogeneous groups of objects. The classification by types of insurance activity is determined by the Conditions for Licensing Insurance Activities in the Territory of the Russian Federation (approved by the order of Rosstrakhnadzor of 1994). Insurance industries include the following types of insurance activities: Personal insurance: - life; - from accidents and diseases; - medical. Property insurance: - means of ground transport; - means of air transport; - means of water transport; - cargo; - other types of property; - financial risks. Liability Insurance: - civil liability of vehicle owners; - civil liability of the carrier; - civil liability of the enterprise - a source of increased danger; - liability for failure to fulfill obligations. Professional liability insurance in connection with the implementation of activities: - notarial; - medical; - different; - insurance of other types of civil liability. Endowment insurance. Insurance of heterogeneous phenomena is connected with solving the problems of insurance protection in the event of the impact of dangerous events on a group of objects that have fundamental differences. In this regard, there are subspecies: mixed and combined insurance. mixed It is used mainly in life insurance: for survival, death, loss of health, etc. Combined It is typical for the combination of insurance of several objects in one event, for example, insurance of means of transport and luggage in combination with insurance of the driver and passengers. 24. CLASSIFICATION OF INSURANCE BY THE METHOD OF INVOLVEMENT IN THE INSURANCE COMMUNITY According to the method of involvement in the insurance community, insurance can be carried out in voluntary and mandatory forms. Voluntary insurance is carried out on the basis of an agreement between the insured and the insurer. The rules of voluntary insurance, which determine the general conditions and procedure for its implementation, are established by the insurer independently in accordance with the provisions of the Law "On the Organization of Insurance Business in the Russian Federation". Insurance conditions are determined at the conclusion of the contract. Compulsory is insurance provided by law. The types, conditions and procedure for conducting such insurance are determined by the relevant laws of the Russian Federation. The society, represented by the state, establishes the obligation for the relevant circle of insurers to make fixed insurance payments when the need to compensate for material damage or provide other financial assistance affects public interests. In Russia, social insurance, insurance of buildings and some farm animals for citizens, military personnel, passengers and some other types of insurance are mandatory. Relevant by-laws introduced compulsory insurance for military personnel, doctors working with HIV-infected people, employees of the State Tax Service who suffered as a result of the accident at the Chernobyl nuclear power plant, compulsory medical and social insurance for employees (contributions to the Social Insurance Fund of the Russian Federation and the Compulsory Medical Insurance Fund are paid by enterprises, organizations, institutions and other economic entities, regardless of the form of ownership). The obligatory form of insurance is distinguished by the following principles: - compulsory insurance is established by law; - continuous coverage of objects established by law is assumed; - automatic distribution to objects; - action regardless of making insurance payments; - indefiniteness; - regulation of insurance coverage. The voluntary form of insurance is based on the following principles: - acts by force of law and on a voluntary basis; - voluntary participation of policyholders, but not insurers in insurance; - selective coverage of objects; - voluntary insurance is always limited by the term of insurance; - Valid only when paying one-time or periodic insurance premiums; - insurance coverage depends on the desire of the insured. 25. LEGISLATIVE REGULATION OF THE INSURANCE BUSINESS To date, the Russian Federation has created a mechanism for registering insurance companies, licensing insurance operations and control by insurance supervision. It is designed to ensure that the interests of policyholders are respected. It is unacceptable to reduce the tariff to a level at which the financial stability of the insurer decreases; in investing, preference is given to although not the most profitable, but reliable objects. A combination of competition and government regulation insurance business is also necessary to stimulate its development in areas where significant profits cannot be expected (crop insurance, environmental risks, etc.). The activities of insurance organizations and the basic concepts of insurance are determined by the Law of the Russian Federation of 1992 (with subsequent amendments), Chapter 48 of the second part of the Civil Code of the Russian Federation and other documents. The activities of insurance organizations are subject to mandatory audit. Associations of insurers acquire the rights of legal entities after state registration with the Department of the Ministry of Finance of Russia for Supervision of Insurance Activities (hereinafter referred to as the Department). Insurance activity in the Russian Federation is subject to licensing. Its conditions on the territory of the Russian Federation are approved by the order of Rosstrakhnadzor dated 1994. Licensing of insurance activities is carried out by the Department. Licensing is subject to the activities of insurance organizations and mutual insurance companies (insurers) associated with the formation of special monetary funds (insurance reserves) required for future insurance payments. Activities for assessing insurance risks, determining the amount of damage, the amount of insurance payments, other consulting and research activities in the field of insurance do not require a license in accordance with the terms of licensing. Relations in the field of health insurance are regulated on the basis of the Law of the RSFSR "On health insurance of citizens in the Russian Federation" dated 1991. 26. STATE SUPERVISION OVER INSURANCE ACTIVITIES State supervision of insurance activities is carried out in order to comply with the requirements of the legislation of the Russian Federation on insurance, the effective development of insurance services, the protection of the rights and interests of policyholders, insurers, other interested parties and the state. State supervision of insurance activities in the territory of the Russian Federation is carried out by the federal executive body for supervision of insurance activities, acting on the basis of the Regulations approved by the Government of the Russian Federation. The main functions of the federal executive body for supervision of insurance activities: - issuance of licenses to insurers to carry out insurance activities; - maintaining a unified State register of insurers and associations of insurers, as well as a register of insurance brokers; - control over the validity of insurance rates and ensuring the solvency of insurers; - establishment of rules for the formation and placement of insurance reserves, indicators and forms of accounting for insurance operations and reporting on insurance activities; - development of normative and methodological documents on issues of insurance activities, referred by law to the competence of the federal executive body for supervision of insurance activities; - generalization of the practice of insurance activities, development and submission in the prescribed manner of proposals for the development and improvement of the legislation of the Russian Federation on insurance. The federal executive body for supervision of insurance activities shall have the right to: - receive from insurers reports on insurance activities, information on their financial position; - receive the information necessary for the performance of the functions assigned to it from enterprises, institutions and organizations, including banks, as well as from citizens; - check compliance by insurers with the legislation of the Russian Federation on insurance and the reliability of their reporting; - if violations of the requirements of the law by insurers are revealed, give them instructions to eliminate them, and in case of failure to comply with the instructions, suspend or restrict the licenses of these insurers until the violations are eliminated or make decisions to revoke licenses; - apply to the arbitration court with a claim for the liquidation of the insurer in the event of repeated violations by the latter of the legislation of the Russian Federation, as well as for the liquidation of enterprises and organizations that carry out insurance without licenses. 27. LICENSING OF INSURANCE ACTIVITIES The license to carry out insurance activities is a document certifying the right of its owner to conduct insurance activities in the territory of the Russian Federation, subject to the conditions and requirements specified when issuing the license. A license may be issued to carry out insurance activities in a certain territory declared by the insurer. The license is issued by the federal executive body for the supervision of insurance activities in the prescribed form and contains the following requisites: - name of the insurer holding the license, its legal address; - name of the industry, form of conduct and type (types) of insurance activity, indicating in the annex the type (types) of insurance to which the insurer is entitled; - the territory in which he has the right to conduct this type (s); - license number and date of issue; - signature of the head (or deputy head) and official seal of the authority that issued the license; - registration number according to the State Register of Insurers. The license for insurance activities does not have a limitation on the validity period, unless it is specifically provided for when issuing. Licenses are issued for voluntary and mandatory: - personal insurance (life insurance, accident and illness insurance, medical insurance); - property insurance (insurance of land, air, water transport, cargo, other types of property, except for the listed, financial risks); - liability insurance (civil liability of motor vehicle owners, carrier, enterprises - sources of increased danger, professional liability, liability for failure to fulfill obligations, other types of civil liability, except for those listed); - reinsurance, if the subject of the insurer's activity is exclusively reinsurance by type of insurance activity. In order to obtain a license for the right to carry out insurance activities, the insurer must have a paid-in authorized capital in accordance with applicable law. The maximum liability for an individual risk under an insurance contract may not exceed 10% of the insurer's own funds. 28. INSURANCE PREMIUM (CONTRIBUTION) The insurance fee is insurance premium (contribution), which the policyholder is obliged to pay to the insurer in accordance with the insurance contract or the law. At the expense of insurance premiums, an insurance fund is formed, which is used to pay insurance compensation, as well as to cover the overhead costs of the insurer. Insurance premium can be paid lump-sum payment or paid in parts, in installments, in the amounts and terms that are established at the conclusion of the insurance contract. After payment of the entire insurance premium or its first part, the insurance contract usually enters into force. In life insurance (accumulative types of insurance), the insurance premium is most often paid in the form of annual, quarterly or monthly installments. At the same time, the total amount of insurance premium contributions made in installments is greater than the insurance premium paid at a time, because, as already noted, the income received from investing the received part of the insurance premium (net premium) participates in the formation of the insurance fund of the insurer for insurance payments. The insurance premium reflects the compensatory nature of the insurance transaction made by the insured and the insurer, and is a payment for the service (price of the service), provided by the insurer to the policyholder under a voluntary insurance contract or in the manner of compulsory insurance provided for by law. Insurance as an economic category covers the sphere of redistributive relations, therefore, an insurance fund (insurance reserves) is formed at the expense of insurance premiums of policyholders, used by the insurer for insurance payments, as well as funds to cover the overhead costs of the insurer. The part of the insurance premium directed to the formation of the insurance fund (only for insurance payments) is commonly called net premium, while the part of the insurance premium intended to cover the costs of the insurer for insurance - load. Net premium - the cost of insurance without taking into account the costs of the insurer for its implementation. Together, the net premium and the load constitute an insurance premium, which is called gross premium. The net insurance premium of each insured for types of insurance other than life insurance (for "risk" types of insurance) characterizes the share of his participation in the formation of the insurance fund, while such insurance is a closed distribution of damage between the insured, i.e., the insurance fund is formed only from the received insurance premiums of insurers. The net insurance premium by types of insurance related to life insurance (cumulative types of insurance) characterizes the share of participation of each insured in the formation of a part of the insurance fund for the subsequent payment by the insurer of insurance coverage to the insured person or insurance payment to his heirs or persons specified by him in the insurance contract. 29. INSURANCE RATE The insurance premium is calculated based on insurance rate, which represents the insurance premium rate per unit of the sum insured or the object of insurance. Insurance rates for compulsory types of insurance are established in the laws on compulsory insurance, and for voluntary types of personal insurance, property insurance and liability insurance, insurers can calculate independently. The specific amount of the insurance rate is determined in the insurance contract by agreement of the parties. The main task, which is set when determining tariff rates, - calculation of the probabilistic amount of damage attributable to each insured or per unit of the sum insured. If the tariff rate fairly accurately reflects the probable damage, then the necessary distribution of damage between the insurers is ensured. Tariff rates are closely related to the volume of insurance liability. Carrying out insurance, the insurer seeks to solve a twofold problem: at the minimum rates available to a wide range of insurers, to ensure a sufficiently significant amount of insurance liability. If the tariff rates are calculated correctly, then the necessary financial stability of insurance operations is ensured, that is, a stable balance of income and expenses of the insurer or an excess of income over expenses. The tariff rate that forms the basis of the insurance premium is called gross rate, which consists of the net rate and the load to the net rate. Net rate is intended for the formation of the insurance fund in its main part, which is used to pay insurance compensation. Strength necessary to cover the costs of conducting insurance (costs for wages of full-time and non-staff employees of the insurance organization, for preparing forms, promotion and advertising of insurance, administrative and business expenses, deductions to reserve, reserve and other funds, the standard for the formation of planned profit from insurance activities ). The load is a smaller part of the gross rate. Thus, the tariff rate guarantees the break-even implementation of insurance. The net rate as the probability of incurring certain damage by the insured reflects each type of insurance liability assumed by the insurer. The insurer pursues a targeted tariff policy to establish, clarify and streamline insurance tariffs. Tariff policy principles: equivalence of the insurance relations of the parties: • net rates should correspond as much as possible to the probability of damage; • availability of insurance rates to a wide range of insurers; • stability of insurance rates for a long period; • expanding the scope of insurance liability; • ensuring the profitability of insurance operations. 30. CONSTRUCTION OF TARIFFS FOR INSURANCE OF PROPERTY AND OTHER RISKS Based on the premise that one insured object dies from each insured event, it should be assumed that the probability of damage, which forms the basis of the net rate, depends primarily on the probability of occurrence of insured events. The methodology for calculating the net rate is reduced to determining the average unprofitability of the sum insured for the tariff period (usually 5-10 years) adjusted for the risk premium. To do this, first of all, a dynamic series of unprofitability indicators of the sum insured is built and its stability is assessed, and depending on this, the size of the risk premium is determined. The stability of the dynamic series is estimated using the coefficient of variation and the median. The following variation coefficient formula is used for tariff calculations: V = L/Qav; L \u1d v (Q - Qav) / t -XNUMX), where V is the coefficient of variation; L - standard deviation; Q - unprofitability of the sum insured; Qav - average unprofitability of the sum insured; t - duration of the tariff period, years. If the time series is stable, a one-time standard deviation from the average loss ratio can be used as a risk premium. Then: N = (Qav + L) × 100, where N is the net tariff rate, %. Otherwise, it is possible to apply a double risk premium or increase the tariff period: N = (Rav + 2 × L) ×100. The methodology for calculating the load to the net rate is based on determining the actual costs of maintaining the insurance bodies attributable to this type of insurance, as a rule, for the last 1-2 years, taking into account inflation. Typically, the load is 9-40% of the gross rate. In compulsory insurance, the share of the load in the gross premium depends on the structure of the insurance tariff for the type of insurance approved by the competent authority. The formula for calculating the gross rate can be represented as follows: B=N(100-H)×100, where H is the specific weight of the load in the gross rate, %. 31. CALCULATION OF INSURANCE RATES FOR TYPES OF INSURANCE RELATED TO LIFE INSURANCE (ACTUARY CALCULATIONS) The insurance rate for types of insurance related to life insurance is based on the same principles as for property insurance, however, so-called actuarial calculations are used. The insurance rate (gross rate) is formed from the net rate and load. The net rate of the insurance rate for life insurance for survival to the term or age established by the insurance contract, or in the event of the death of the insured, is calculated based on the condition for ensuring equivalence between insurance premiums and the return on investment of insurance reserves, on the one hand, and the amount of insurance payable security, on the other hand, under all insurance contracts concluded with such a condition. The amount of the net insurance premium rate life insurance calculated according to: a) the age and sex of the policyholder at the time the insurance contract comes into force or the insured person; b) type, amount and term of payment of insurance coverage; at) term and period of payment of insurance premiums; d) the term of the insurance contract; d) the planned rate of return from investing the funds of insurance reserves for life insurance, adopted in the calculation. When calculating specific values of tariff rates it is necessary to use mortality tables calculated for the region in which insurance is provided, separately for men and women due to their different average life expectancy. In addition, when insuring the life of population groups united according to some specific characteristics, for example, by type of activity (miners, metallurgists, etc.) or place of residence (urban, rural areas), the use of mortality tables compiled specifically for them will provide higher reliability. calculations. The long-term validity of life insurance contracts and the specifics of the insurance obligation for insurance payment determine the requirements for calculating insurance rates. When calculating them under life insurance contracts, the following circumstances are taken into account: - an increase in the age of the insured during the term of the life insurance contract changes the probability of an insured event, while its probability is determined on the basis of mortality tables. For example, the probability of dying within the next year of life is calculated by the formula Q(x) = D(x)/L(x). - the amounts of insurance payments payable upon the occurrence of an insured event are determined taking into account the interest income from investing the funds of insurance reserves (the amount of insurance premiums in the amount of the net insurance rate paid under the insurance contract). 32. THE BASIS OF THE FINANCIAL STABILITY OF THE INSURER. INCOME AND EXPENSES OF THE INSURANCE ORGANIZATION The basis of financial stability insurers are the paid-in authorized capital and insurance reserves, as well as the reinsurance system. The minimum amount of the paid authorized capital formed at the expense of funds on the day a legal entity submits documents for obtaining a license to carry out insurance activities must be at least 25 thousand minimum wages (minimum wages) - when carrying out types of insurance other than life insurance; at least 35 thousand minimum wages - for life insurance and other types of insurance; at least 50 thousand minimum wages - with reinsurance only. An insurance company may Incomes from insurance activities, investments, risk management, consultations, personnel training and other operations. Income from insurance operations is generated from insurance payments. Their basis is the insurance rate. At the same time, the volume of payments determines the size of the insurance fund, and the structure of the tariff rate determines the direction of the funds of this fund. Insurance payments are a source of financing for investment activities. Insurer's expenses formed during the distribution of the insurance fund. The composition and structure of expenses determine two interrelated economic processes: the repayment of obligations to policyholders and the financing of the activities of an insurance organization. In this regard, the insurance business adopted the following cost classification: 1) expenses for the payment of insurance compensation; 2) contributions to reserves; 3) the costs of doing business: - acquisitions (made for the purpose of concluding new insurance contracts); - collection (to pay employees for the collection of insurance premiums and servicing policyholders); - liquidation (made after the occurrence of an insured event); - managerial (remuneration of administrative and managerial personnel, administrative and economic expenses, expenses for the development of insurance). Together, these costs represent the cost of insurance operations. 33. INSURANCE RESERVES AND FUNDS OF INSURERS In order to ensure the fulfillment of the accepted insurance obligations, insurers, in the manner and under the conditions established by the legislation of the Russian Federation, form from the received insurance premiums the necessary for future insurance payments insurance reserves for personal insurance, property and liability insurance. In a similar manner, insurers have the right to create reserves to finance measures to prevent accidents, loss or damage to the insured property. Insurance reserves reflect the amount of obligations not fulfilled at the moment by insurers under the insurance contracts concluded with the insured and are intended to ensure that the insurer can meet its obligations that it bears in accordance with the insurance contracts concluded by it with the insured. According to the technique adopted abroad for the formation of insurance reserves, each type of obligation that the insurer has is covered by the corresponding type of insurance reserve. In particular, in life insurance, depending on the terms of contracts, mathematical reserves, annual annuity reserves, fund reserves and participation reserves are formed; for other types of insurance - premium reserves (reserve for unexpired risks, increasing risks) and reserves for losses (established but unpaid; presented but not established; not presented). The amount of insurance reserves must fully cover the amount of future payments under existing contracts. Therefore, determining their size is the result of a thorough analysis of the insurer's operations and labor-intensive mathematical calculations. Foreign practice shows that if there are experienced and qualified specialists, such a calculation becomes quite reliable, and its results largely guarantee the insurer against possible bankruptcy. With all the variety of insurance operations in foreign legislation, they are usually divided into two big groups - life insurance and other types of insurance, since these types of insurance are based on different technical principles. The main types of insurance reserves for "other than life" insurance. The insurer makes contributions to the following reserves: 1. Technical reserves: 1.1. Unearned premium reserve (URP). 1.2. Loss reserves: reserve for reported but unsettled losses (RZU); • provision for incurred but unreported losses (IBNR). 1.3. The insurer, in agreement with the Federal Body for the Supervision of Insurance Activities, may form additional technical reserves: • disaster reserve (RC); • loss fluctuation reserve (RCU). 1.4. Other types of technical reserves related to the specifics of obligations assumed under insurance contracts. 2. Reserve of preventive measures (RPM). 34. RNP RESERVE RNP reserve in the strict sense, it is not a reserve, but an article that delimits the accounting of insurance premiums between adjacent reporting periods. RNR represents the basic insurance premium received under insurance contracts in force in the reporting period and related to the period of validity of the insurance contract that goes beyond the reporting period. Those shares of insurance premiums paid by policyholders in any reporting period that relate to risk coverage during the period following the date on which the balance sheet was drawn up are transferred. At present, the share of contributions carried forward is largely calculated on a pro-rata basis. First of all, it is used with a small amount of insurance transactions. Along with this, methods of lump-sum determination of this reserve are used. To calculate RNP, the types of insurance activities are divided into three accounting groups: Group 1 includes insurance: accident and illness insurance; • voluntary medical; • means of ground transport; • means of air transport; • means of water transport; • cargo; • other types of property insurance; • liability of vehicle owners; • other types of liability. 2nd accounting group: insurance of financial risks; • liability of borrowers for non-repayment of loans. 3nd accounting group: types of insurance that provide for the possibility of concluding insurance contracts with indefinite ("open") dates for the start and end of the insurance contract. For the 1st accounting group, there are two options for calculating RNP. If we present the structure of the tariff rate as a sum: rate = loss + commission to agents + acquisition costs + loss elimination costs, then reserve = time remaining at the time of the balance sheet until the end of the insurance period / term of the contract x (losses + losses elimination costs). For the correct calculation of the reserve by this method, it is necessary to properly maintain accounting and statistical records. Although the time-proportional method is the most accurate, it is quite difficult to use it for large volumes of transactions due to its laboriousness. Moreover, if transactions are carried out according to homogeneous risk groups and the receipt of contributions is evenly distributed throughout the year, then this method is not needed at all. In these cases, it is advisable to apply the so-called lump-sum methods for calculating insurance reserves: "method 1/8", "method 1/24", "method 36%". For the 2nd accounting group unearned premium is determined for each insurance contract in the amount of the basic insurance premium until the full expiration of the insurance contract. For the 3nd accounting group unearned premium is determined for each insurance contract in the amount of 40% of the base insurance premium at the reporting date. 35. Lump-sum calculation methods Method 1/8 consists in the fact that, taking into account the organization of work by the insurer on the conclusion of contracts during the year, an assumption is made that all contracts concluded during one quarter for a period of one year are concluded in the middle of the quarter (i.e., for example, for the II quarter - May 15). With this in mind, the unearned premium reserve is calculated on insurance premiums received: - 4 quarters ago from the date on which the premium reserve is calculated, - in the amount of 1/8 from the specified insurance premiums; - 3 quarters ago from the date on which the premium reserve is calculated, - in the amount of 3/8 from the said contributions; - 2 quarters ago from the date on which the premium reserve is calculated, - in the amount of 5/8 from the said contributions; - 1 quarter ago from the date on which the premium reserve is calculated, - in the amount of 7/8 from said contributions. Method 1/24 similar to method 1/8 and differs only in that here all contracts concluded during the month for a period of one year are considered concluded in the middle of the month, that is, on the 15th day. Accordingly, this method is more accurate, but also more laborious. Method 36% used for a very large number of insurance contracts, when the date of conclusion of the contract does not matter and it is considered that all contracts are concluded in the middle of the year, i.e. July 1. Thus, the reserve at the end of the year should be half the net premium. At the same time, for greater simplification, the calculation is made not from the net premium, but from the gross contributions. It is believed that the gross tariff is divided into two parts: 72% - net rate; 28% - load. Thus, half of the net rate equals 36% of the gross rate. Therefore, the unearned premium reserve under this method on December 31 will be equal to 36% of insurance premiums received for the year. This is the least accurate, but, on the other hand, the simplest method of calculating the unearned premium reserve. 36. LOSS PROVISIONS (RZU, RPNU, RK) Provision for reported but unsettled claims (RZU) is formed by the insurer to ensure the fulfillment of obligations, including expenses for the settlement of losses, under insurance contracts not performed or not fully performed as of the reporting date, arising in connection with insured events that occurred in the reporting or previous periods and the fact of the occurrence which are declared to the insurer in accordance with the procedure established by law or the insurance contract. The RZU value is determined for each unsettled claim. If the loss is declared, but the amount of damage is not established, the maximum possible amount of loss, not exceeding the sum insured, is taken into account for calculation. The RZU value corresponds to the amount of reported losses for the reporting period, registered in the loss register, increased by the amount of unsettled losses for the periods preceding the reporting period, and reduced by the amount of losses already paid during the reporting period, plus expenses for the settlement of losses in the amount of 3% of the amount of unsettled claims for the reporting period. Provision for incurred but unreported losses (IBNR) is intended to ensure the fulfillment by the insurer of its obligations, including expenses for the settlement of losses, under insurance contracts that arose in connection with the occurrence of insured events during the reporting period, the fact of the occurrence of which was not declared to the insurer in accordance with the procedure established by law or the insurance contract for the reporting period. date. The amount of IBNR is calculated in the amount of: - 10% of the amount of the basic insurance premium received in the reporting period, if it is considered a year; - 10% of the amount of the basic insurance premium received in the reporting period, and three periods preceding the reporting period, if it is considered a quarter. These include reserves for reported and unreported losses. The essence of the first of them is that, if at the reporting date the insurer has not made an insurance payment for a settled (ie, recognized by him) insured event, the amount of such payment is reserved. Disaster reserve (RC) is designed to cover extraordinary damage resulting from a force majeure or a large-scale accident, resulting in the need for insurance payments under a large number of insurance contracts. The AC is formed by types of insurance, the terms of which provide for the obligation of the insurer to make an insurance payment in connection with damage caused as a result of force majeure or a large-scale accident. The procedure, conditions for the formation and use of the AC are determined by the insurer and agreed with the authorities for the supervision of insurance activities. 37. RESERVE FOR FLUSHING UNFORMED. RESERVE FOR PREVENTIVE ACTIONS Loss Fluctuation Reserve (CGR) is intended to compensate the insurer's expenses for making insurance payments in cases where the loss ratio of the sum insured in the reporting period exceeds the expected loss ratio, which was the basis for calculating the net rate of the insurance rate by type of insurance. The procedure, conditions for the formation and use of this reserve are determined by the insurer and agreed with the authorities for the supervision of insurance activities. The considered insurance reserves are the most common and are formed by the majority of existing insurers, which is reflected in legislative acts. Taking into account the fact that the conduct of a number of types of insurance has some specifics, the legislation usually provides that the insurer, in agreement with the insurance supervision department, has the right to form additional insurance reserves if the existing reserves do not fully cover its obligations, and if there is an appropriate justification, confirmed by calculations . These reserves include: - in case of subsequent recalculations of premiums (for example, in insurance against production stoppage as a result of fire and/or technical malfunctions of equipment); - in case of reversal of the payment of premiums, affecting the claims of the insurer to the insured and the insurance representative, causing a decrease or disappearance of insurance risks; - insurance of nuclear installations; - liability insurance for pharmaceutical products; - earthquake insurance; - for imminent losses. Reserve of preventive measures (RPM) is intended to finance measures to prevent accidents, loss or damage to the insured property, as well as for the purposes provided by the insurer in the regulation on the reserve of preventive measures, which is approved by the department for supervision of insurance activities. RPM is formed by deduction from the gross insurance premium received under insurance contracts in the reporting period. The amount of deductions in the RPM is determined based on the percentage provided for in the structure of the tariff rate for these purposes. The value of the RPM corresponds to the amount of deductions to this reserve in the reporting period, increased by the value of RNP at the beginning of the reporting period and reduced by the amount of funds spent on preventive measures in the reporting period. 38. LIFE INSURANCE PROVISIONS Mathematical reserves represent the difference between the current value of the insurer's obligations (forthcoming insurance payments under current insurance contracts) and the current value of the insured's obligations (insurance premiums that insurers must pay in the future under existing insurance contracts). Mathematical reserves are the main type of reserves for life insurance operations and correspond to the premium reserves and loss reserves used for types of insurance other than life. However the nature of insurance reserves for life insurance is fundamentally different. With the long-term nature of the relationship between the insurer and the insured, as they are in the case of life insurance, the annual premium paid by the insured in any year of insurance is an average of the sums of premiums attributable to different years. This average premium in the first years of the insurance contract will exceed the annual risk. In subsequent years, he will be lower than him. The insurer must save these surpluses of the first years to cover shortages in subsequent years. The receipts of insurance premiums in any year will not correspond to the insurance payments made by the insurer for the same year: in the first years of the insurance contracts, the number of premium payers will be greater, and the number of deaths will be less (for a certain group of insurers). Later, the opposite will be observed. Obviously, in the beginning, the sums of premiums will not only cover the obligations of the insurance company, but also provide a surplus. There will come a time when the sums of both will equalize, and finally, even later, the incoming premiums will not be enough to cover the obligations. Therefore, the insurance company from the surplus of insurance premiums received in the first years forms a specific insurance reserve, which, for clarity of presentation and distinction from other insurance reserves, is called the premium reserve. These premium reserves play a key role, since a correctly calculated premium reserve is the first and main condition for the solvency of a life insurance company in the technical sense. The correct calculation of premium reserves is important both for the companies themselves and for the insurers. The size of the reserve depends on the mortality table underlying the calculations, as well as on the rate of technical interest. 39. METHODS FOR CALCULATION OF LIFE INSURANCE PREMIUM RESERVE There are numerous methods for calculating the life insurance premium reserve. In the net premium paid according to the average constant rate method, two parts can be distinguished: one part is intended for insurance payments for deaths during a given year, and the other part goes to the formation of a reserve (from which insurance amounts will be paid at the end of the insurance period). ). The first part is called risk premium, and the second - savings premium. This last part is deposited in the reserve from the very first year of insurance according to the so-called method of unchanging, constant net premiums. In many years of insurance practice, due to the significant costs of acquiring new insurance (high commissions for agents, fees for doctors involved in examining potential insured people, etc.), they often set aside a smaller share in the first year reserve than should be on the net savings premium. This shortfall in the first year is made up for by slightly larger deductions to the reserve in subsequent years. Ultimately, the amount of reserves for each insurance under both methods will be equal. Sprague method lies in the fact that with long-term insurance, the reserve of premiums during the first years is not postponed. This usually happens within the first one or two years, during which insurance agents receive a large share of the commission. The deposition of the reserve from the second or third year is made not according to the actual age of the insured, but according to the age increased by one or two years, and according to the period, respectively, reduced by one or two years. On Zilmer method of each annual premium, the risky part is left unchanged to cover the cost of death, and that part, called the savings premium, is set aside in a smaller amount. Optimality of insurance reserves. The sufficiency of insurance reserves is understood as the adequacy of their structure and size to the obligations assumed by the insurer under insurance contracts. Evaluate insurance reserves in terms of their sufficiency should be based on the nature of the operations carried out by the insurer. The structure of insurance reserves is extremely diverse, and the methods by which they can be calculated are no less diverse. Therefore, it is possible to speak about the sufficiency of insurance reserves only in relation to an individual insurer, since the establishment of any standards here is very problematic. At the same time, it can be argued that if a number of insurance organizations carry out similar insurance operations and the volumes of these operations are comparable, the amounts of insurance reserves formed by them should be commensurate. Thus, in principle, certain indicators can be established to assess the sufficiency of insurance reserves. Such an indicator can be, for example, the ratio between the amount of insurance reserves and the amount of collected insurance premiums, or the ratio of insurance reserves to the amount of insurance payments, etc. 40. OWN CAPITAL OF AN INSURANCE COMPANY К own funds or equity insurer include: authorized capital, additional capital, reserve capital, retained earnings. In some cases, the consumption fund and the accumulation fund formed at the expense of the insurer's net profit can be attributed to own funds. Own funds are formed from two sources - at the expense of the contributions of the founders and at the expense of the profit received as a result of the activities of the insurer. For the purposes of ensuring solvency, the amount of free reserves should be the greater, the greater the volume of operations of the insurance company. At the same time, depending on the nature and dynamics of operations, either the volume of insurance premiums received, or the average amount of insurance payments over a number of years, or the amount of technical reserves are taken as their volume. In order to ensure solvency, insurers are required to comply with the standard ratios between assets and insurance liabilities assumed by them: the amount of free assets of the insurer, calculated as the difference between the total amount of assets and the amount of its liabilities, must correspond to the standard amount, i.e., the equality must be observed: A - O \uXNUMXd H, where A is the actual size of the insurer's assets; About - the actual volume of obligations of the insurer; H is the normative (i.e., the minimum allowable) amount of excess of the insurer's assets over its liabilities. Under assets means the property of the insurer in the form of fixed assets, materials, cash, as well as financial investments. Liabilities characterizing the debt insurer to individuals and legal entities: • insurance reserves; bank loans and credits; other borrowed and borrowed funds; • reserves for future expenses and payments; • settlement obligations for reinsurance operations; etc. Based on the well-known balance equality: Assets = Liabilities + Equity we find that: Assets - Liabilities = Equity. The legislation also defines the maximum level of liability of the insurer for a particular risk in the amount of 10% of the insurer's own funds. A sufficient amount of own funds, or free reserves, of the insurer guarantees its solvency under two circumstances - the presence of reasonable insurance reserves and the correct investment policy. At the same time, it is necessary that the insurer's portfolio consists of a very large number of approximately equal risks or a small number of small risks commensurate with the size of the insurer's own funds, which can be achieved through the reinsurance system. 41. INVESTMENT POLICY OF THE INSURER Investment principles. The fundamental difference between the implementation of an insurance service and a similar process in other types of business is that an ordinary enterprise initially makes certain investments in the organization of the production of goods (services) and receives payment from consumers after the service has actually been provided or the goods have become the property of the buyer, then As in insurance, the picture is reversed. Here, the client actually advances the insurer, since the insurance premium, which represents the payment for the insurance service for the policyholder, is usually paid at the beginning of the term of the insurance contract. The insurance service from the insurer can be implemented for a long time. This feature of the implementation of insurance services allows us to formulate two conclusions. 1. The nature of the movement of financial resources in insurance leads to the fact that at the disposal of the insurer for a certain period of time there are temporarily free from obligations funds that can be invested in order to generate additional income. 2. The investment by the insurer of such temporarily free funds should be strictly regulated by the state, since the insurers are objectively deprived of the opportunity to control how skillfully the insurance company manages the funds provided to it and whether it will jeopardize the fulfillment of obligations under insurance contracts. Insurers have the right to invest or otherwise place insurance reserves and other funds, as well as issue loans to policyholders who have concluded personal insurance contracts, within the sums insured under these contracts. Insurance reserves must be placed by insurers on the following conditions. Recurrence principle fully applies to both assets covering insurance reserves and free assets. This principle implies the most reliable placement of assets, ensuring their return in full. Liquidity principle states: the general structure of investments should be such that at any time there are liquid funds or capital investments that are easily converted into liquid funds. In other words, the insurance company at any time must have an amount of funds that ensures the payment of the amounts specified in the contract to the insurers within the established time limits. The principle of diversification investments serves to distribute the investment risks that each investor faces on different types of investments and thus to increase the stability of the insurer's investment portfolio. The principle of profitability of investments: Assets must be placed while ensuring these principles, taking into account the situation on the investment market, and at the same time bring a constant and sufficiently high income. 42. ALLOCATION OF INSURANCE RESERVES The rules for placing insurance reserves by insurers were approved by order of the Russian Ministry of Finance dated 1999. These rules establish requirements for assets accepted to cover (secure) insurance reserves. Types of assets accepted to cover insurance reserves: - government securities of the Russian Federation, constituent entities of the Russian Federation and municipal securities (that have passed state registration and have a registration number, unless otherwise provided by the legislation of the Russian Federation); - bills of banks (having a license to carry out banking operations); - shares (except shares of insurers); - bonds (that have passed state registration and have a registration number, unless otherwise provided by the legislation of the Russian Federation); - housing certificates; - investment shares of mutual investment funds; - bank deposits (deposits), including those certified by certificates of deposit in banks licensed to carry out banking operations; - certificates of equity participation in general funds of banking management; - shares in the authorized capital of an LLC and contributions to the share capital of limited partnerships, the charters of which do not provide for restrictions on the withdrawal of funds in a reasonably short period of time (except for shares and contributions to the capital of insurers); - real estate (with the exception of individual apartments subject to state registration of aircraft and sea vessels, inland navigation vessels and space objects); - the share of resident reinsurers or non-residents with representative offices in the Russian Federation in insurance reserves; - depot of premiums on risks accepted for reinsurance; - receivables of policyholders (after approval by the Russian Ministry of Finance), reinsurers, insurers and insurance intermediaries, payments on which are expected within 3 months after the reporting date, which are not overdue and arose as a result of insurance and reinsurance operations; - cash; - cash in bank accounts; - foreign currency on bank accounts; - gold and silver bars located on the territory of the Russian Federation; - others (as agreed with the Russian Ministry of Finance). Assets accepted to cover insurance reserves cannot serve as a subject of collateral or as a source of payment to the creditor of funds for the obligations of the guarantor (guarantor). Securities issued by foreign issuers must be admitted to circulation on stock exchanges or other organizers of trading on the securities market. The issuer must have a license to carry out activities for the organization of trading in the securities market. 43. PERSONAL INSURANCE. LIFE INSURANCE К personal insurance include all types of insurance associated with probabilistic events in a person's life. According to the classification of insurance adopted in Russia, the personal insurance industry includes types of insurance in which the object of insurance is property interests related to life, health, working capacity and pensions of the insured or the insured. In developed countries (USA, Germany, Japan, Great Britain, etc.), personal insurance ranks first among other insurance industries in terms of premiums collected. These types of insurance perform an important social function, since they affect the interests of each person. Therefore, in all countries, special attention is paid to the development and maintenance of personal insurance. World insurance practice has developed many varieties of life insurance. Consider the types of personal insurance most commonly used in Russia. К life insurance include all types of insurance in which the object of insurance is human life. Life insurance contracts are concluded for a period of at least 1 year, so life insurance can combine savings and risk functions. For example, this type of insurance is a mixed insurance in case of death and survival, which is popular in foreign countries. In Russia, mixed life insurance most often also includes accident insurance. Thus, the insurance liability for mixed life insurance in our country provides for the payment of the sum insured in the following cases: when the insured survives until the end of the insurance period; in case of loss of health from an accident; upon the death of the insured. Mixed life insurance. Mixed life insurance contracts are concluded with individuals. When selecting insurers, the insurer is guided by three criteria: the age of the insured and his state of health as the main factors determining the mortality rate, as well as the citizenship of the insured. The initial age is determined by the receipt by the insured of the legal capacity established by law and the presence of an identity passport. The insurers must be citizens of the Russian Federation, but they can also be foreign citizens and stateless persons if they permanently reside in Russia. The volume of insurance liability determined by mixed life insurance provides for the following insured events: - life insurance; - accident insurance; - death insurance. The same types of insurance can be applied as independent ones. 44. ACCIDENT AND ILLNESS INSURANCE Accident and illness insurance intended to compensate for damage caused by loss of health or death of the insured. It can be carried out in group (for example, insurance of employees of the enterprise) and individual forms, as well as in the forms of voluntary and compulsory insurance (for example, passengers, military personnel and other categories of citizens). Accident insurance is built on the same principles as mixed life insurance. The most important of them is the limitation of the scope of insurance liability by the specified consequences of an accident that happened to the insured during the period of insurance. This limitation ensures the availability of insurance rates and promotes the widespread development of accident insurance as a direct supplement to social insurance. The most widespread is individual insurance against accidents in case of death, temporary disability, permanent full or partial disability (disability). Do not apply to insured events: - injuries received by the insured in connection with the commission of actions in which the investigating authorities or the court established signs of an intentional crime; - injuries sustained by the insured in connection with driving under the influence of alcohol, narcotic or toxic intoxication by any self-propelled vehicle with an internal combustion engine or an electric motor (car, motorcycle, scooter, moped, bicycle with a motor, tractor, harvester, trolleybus, tram, etc.) d.), boat or motorboat, as well as in connection with the transfer of control of them to a person who is in a state of alcoholic, narcotic or toxic intoxication; - injury or poisoning as a result of the insured's attempted suicide; - intentional infliction of bodily harm by the insured; - death as a result of the listed causes; - adverse consequences of diagnostic, therapeutic and preventive measures (including drug injections), if they were not associated with treatment for an insured event that occurred during the period of validity of the insurance contract. Payment under contracts accident insurance, which plays the role of material assistance, can be done in the form: • the sum insured specified in the contract; • part of the sum insured specified in the contract; • pensions; • insurance benefit; • daily reward. The validity of the accident insurance contract shall terminate upon the expiration of the insurance period on the day preceding the one on which the contract entered into force; in case of payment by the insurer of the full sum insured specified in the insurance certificate; in the event of the death of the insured. Other grounds for termination of the contract may be provided (for example, in the case of the insured's departure for permanent residence abroad). 45. BASICS OF PROPERTY INSURANCE Property insurance carried out mainly in the form of voluntary insurance, with the exception of state property leased. Insurers are any enterprises and organizations of various organizational and legal forms, as well as individuals. Under property insurance contracts any part (group) of property can be insured. Legal entities and individuals can insure property both in its full assessment, that is, at the actual, real, value, and in a certain proportion. When insuring property, the sum insured cannot exceed its actual value at the time of conclusion of the contract. Under the actual value of the property replacement (book) value is understood. If the sum insured determined by the insurance contract exceeds the insured value of the property, the contract is invalid by virtue of law in that part of the sum insured that exceeds the actual value of the property at the time of conclusion of the contract. One of the conditions of property insurance is often the definition of a deductible - an unpaid part of the damage. The amount of the deductible is approximately equal to the cost of the insurer to determine the amount of damage. A franchise can be conditional or unconditional. Conditional the franchise determines the unpaid part of the damage if the amount of damage is less than its value. If the amount of damage exceeds the size of the conditional deductible, then it is not taken into account when determining the amount of damage. Unconditional the franchise determines the unpaid part of the damage, regardless of its size. The deductible is set as a percentage of the sum insured or in absolute terms. When concluding the contract, the policyholder must inform the insurer of all circumstances known to him that affect the degree of risk. If the policyholder deliberately violates this circumstance, the insurer shall have the right to terminate the contract during the term of the contract within one month from the date of receipt of information about the circumstance that increases the risk. Notice of termination of the contract is submitted to the policyholder in writing, the termination takes effect immediately upon receipt by the policyholder of this application. Upon termination of the insurance contract, the part of the premium proportional to the period from the date of termination of the contract until the end of the contract, if it had not been terminated, must be returned. The main obligation of the insured under property insurance contracts - compliance with legal, official or agreed security measures in the insurance contract. If the policyholder violates one of the obligations through his own fault, the insurer has the right, within one month from the date of receipt of the news of the violation of obligations by the policyholder, to immediately terminate the contract with the policyholder, notifying the latter in writing. 46. PROPERTY INSURANCE OF ORGANIZATIONS State and non-state enterprises, joint-stock companies, concerns and other associations may conclude various types of insurance contracts. According to the main contract all property belonging to the enterprise is subject to insurance: buildings, structures, transmission devices, power workers and other machines, equipment, vehicles, fishing and other vessels, fishing gear, work in progress and capital construction, inventory, finished products, goods, raw materials, materials, etc. The enterprise has the right to insure any part (group) of their property. Under additional agreements, property can be insured: - received by the enterprise under a property lease agreement (if it is not insured from the lessor) or received from other enterprises (organizations) and the public for processing, repair, transportation, storage, commission, etc.; - for the period of experimental or research work, exhibiting at exhibitions. Property leased to other enterprises and organizations may be insured separately from other own property. Not usually subject to voluntary insurance especially valuable property and property that does not have an objective valuation: documents, cash, securities, precious metals and stones, manuscripts, drawings, plans, etc. This property, as well as property, the insurance protection of which is carried out under specific conditions ( means of transport, mobile construction and other machines, farm animals, industrial timber and firewood in cutting areas and during rafting, etc.) can be insured under special conditions as an addition to the main contract. Can't be insured for voluntary insurance of buildings, structures and other property located in an area threatened by collapses, landslides, floods and other natural disasters from the moment such a threat is announced in the prescribed manner or the competent authorities (hydrometeorological services, etc.) draw up an appropriate document (act, conclusion etc.) confirming the threat. Exception: when the insurance contract is concluded for a new term (renewed) before the expiration date of the previous contract and within the share of the property value specified in the previous insurance contract. An indispensable condition for entering into contractual insurance relations - the organization has the rights of a legal entity. Damages are reimbursed in the event of loss or damage to property from a fire, lightning strike, explosion, flood, earthquake, ground subsidence, storm, hurricane, downpour, hail, collapse, landslide, severe frosts unusual for the area and heavy snowfalls, power outages caused by natural disasters , accidents of means of transport, heating and other systems, etc. Additionally, property can be insured against burglary (robbery), theft of means of transport. 47. FIRE INSURANCE (FIRE INSURANCE). PROPERTY INSURANCE OF CITIZENS Abroad (and recently in Russia) fire insurance, which is considered as the main type of property insurance. This type of insurance provides insurance protection against complex risk, called in international practice FLEX (Fire + Lightning + Explosion + Aircraft impact), which assumes as an insured event fire, lightning strike, explosion, fall of a manned aircraft, its parts or cargo. At the same time, in the general conditions of fire insurance, definitions are given for each insured event and exceptions are indicated accordingly. As additional to fire insurance, as well as independent types of insurance, the following types of insurance are used: - from burglary, theft turning into robbery, robbery or their attempts; - from a storm; - from hail; - from tap water; - from collision with vehicles; - from smoke; - from other types of risks. When listing risks, their definitions and exceptions are given, in which compensation does not occur. Citizens' property insurance. The home property of citizens is most often insured in case of its destruction or damage as a result of natural disasters, as well as fire, explosion, collision with vehicles, falling trees and aircraft, sudden destruction of the main structures of the buildings in which the property is located, accidents in the water heating system, water supply and sewerage, deliberate illegal actions of third parties, as well as theft of property and its destruction (damage) associated with theft or attempted theft. Household items are considered insured at the place of residence of the insured, as well as during the move to a new permanent place of residence. 48. TRANSPORT INSURANCE Transport insurance - a sub-branch of property insurance, a set of types of insurance against dangers arising on various routes of communication. The objects of insurance can be both means of transport (casco insurance), and the goods they carry (cargo insurance). In accordance with the Rules of transport insurance of goods no reimbursement is made for damages caused by: any kind of hostilities or measures and their consequences, damage or destruction by mines, torpedoes, bombs and other weapons of war, piracy, as well as due to civil war, civil unrest and strikes, confiscation, requisition, arrest or destruction of goods at the request of the authorities; • direct or indirect effects of an atomic explosion, radiation or radioactive contamination associated with any use of atomic energy and the use of fissile materials; • intention or gross negligence of the insured or the beneficiary, or their representatives, as well as due to violation by any of them of the established rules for the transportation, forwarding and storage of goods; • effects of temperature, hold air or special properties and natural qualities of the cargo, including shrinkage; • inadequate packaging or sealing of goods and shipment of goods in a damaged condition; • fire or explosion due to loading, with the knowledge of the insured or the beneficiary, or their representatives, but without the knowledge of Ingosstrakh, substances and objects dangerous in relation to explosion or spontaneous combustion; etc. First option cargo insurance - "With responsibility for all risks" - involves compensation for losses from damage or complete destruction of all or part of the property arising from any reasons (except those specifically specified above), as well as the necessary and appropriate expenses for saving and preserving the cargo, to prevent further his damage. The second option cargo insurance - "With liability for a private accident" and third option - "Without liability for damage, except in the event of a crash" - provide for limited list of insured events: fire, lightning, storm, whirlwind and other natural disasters, wreck or collision of ships, aircraft and other conveyances with each other or their impact on fixed or floating objects, grounding of a ship, failure of bridges, explosion, damage to a ship by ice; • the loss of a vessel or aircraft without a trace; • accidents during loading, stowage, unloading of cargo and taking fuel by the vessel; • general average; • all necessary and expedient expenses incurred to salvage the cargo, as well as to reduce the loss and to establish its amount, if the loss is compensated under the terms of insurance. Feature of insurance of the third option: losses are indemnified only from the total loss of all or part of the cargo, and losses from damage to the cargo - only in cases of a crash or collision, fire or explosion on a ship, aircraft or other means of transportation. 49. BUSINESS RISK INSURANCE Object of business risks insurance - commercial activity of the insured, which provides for the investment of monetary and other resources in any type of production, works or services and the receipt of income from these investments after a certain period of time. This insurance is one of the most complex types of insurance. The responsibility of an insurance organization for insurance of commercial risks is to compensate the insured for losses incurred as a result of unfavorable, unpredictable changes in market conditions and deterioration of other conditions for the implementation of commercial (investment) activities. Possible Two options for setting the sum insured: 1) the sum insured is set within the limits of capital investments in insured operations; 2) the sum insured includes not only capital costs, but also a certain (normative) profit, which is expected from the costs. The insurance indemnity is determined as the difference between the sum insured and the actual financial results from the insured commercial activity. The term of the insurance contract in this case will be determined by the standard payback period for capital expenditures. Features of this type of insurance: payment (or non-payment) of compensation occurs at the end of the insurance period, when the final results of commercial operations are revealed. Exceptions to the liability of the insurer: certain types of activities (for example, trading and intermediary, gambling, sweepstakes, etc.); wars and hostilities; government decisions and political upheavals; exchange rate changes, etc. 50. RISK INSURANCE FOR NEW EQUIPMENT AND TECHNOLOGY This type of insurance includes insurance for: - the equipment itself, installations, production lines, etc. in case of their failure, disruption of work, death, i.e. protection of direct losses; - from unforeseen, unfavorable consequences caused by the introduction of technical and technological innovations. Here there are indirect (indirect) losses in the form of additional costs and lost profits. New equipment and technology are insured against the risks associated with their use. Such risks include errors in the design of machines and the development of technology, in the selection of materials or in their manufacture; hidden defects that could not be detected during testing; failure of measuring, regulating or safety devices; increased voltage and pressure; negligence, malicious intent of individuals, etc. Features of this insurance is to compensate for losses resulting from an accidental error or unintentional actions of persons who had the necessary professional training to work with new equipment and technology. If unprepared people were allowed to manage, then the occurrence of losses cannot be considered unforeseen. The insurance does not cover losses due to fires, explosions and other risks insured in property insurance. Franchise applied. 51. LIABILITY INSURANCE. CIVIL LIABILITY OF VEHICLE OWNERS RџSЂRё liability insurance the object of insurance is property interests related to compensation by the insurant (insured person) for the harm caused by him to the person or property of third parties. According to Art. 1064 of the Civil Code of the Russian Federation, harm caused to the person or property of a citizen, as well as harm caused to the property of a legal entity, is subject to compensation in full by the person who caused the harm. The basis for exemption from liability for the damage caused can only be evidence by the person who caused the damage that the damage was caused through no fault of his (for example, as a result of the intentional actions of the victim or due to force majeure circumstances). Insurance helps to simplify these relations regarding compensation for harm by concluding a liability insurance contract. Liability insurance covers the following types of damage: - property damage (damage to property) - the cost of repairs to restore movable and / or immovable property, other expenses caused by damage; - personal damage (personal harm) - treatment costs; - moral damage (compensation for suffering); - Claims of indirect victims (for example, in case of death of the breadwinner, burial expenses, etc.). The most common type of liability insurance in the world is civil liability insurance of vehicle owners, which in most countries (including Russia) is mandatory. According to the general conditions of insurance, both the owner of the car and the driver, if he is not the owner, must carry out compulsory insurance. The insurer pays the actual expenses caused by the insured event, however, not more than the sum insured provided for by the insurance contract. Civil liability insurance involves compensation for property damage: covering the cost of repairing a car or reimbursement of the cost in the event of its complete destruction; compensation for losses in case of a decrease in the value of the car; loss of earnings; covering the cost of renting a car for the period of its repair; compensation for losses from vehicle downtime and other material losses. As compensation for personal losses, expenses for treatment, loss of earnings, moral damage, expenses for examination, etc. are reimbursed. Feature of car owners liability insurance is the differentiation of tariff rates depending on the engine power of the car, the area where the car is registered, the period of accident-free driving of the insured and other factors. 52. CIVIL LIABILITY INSURANCE FOR ENTERPRISES Economic activity is often associated with the possibility of causing harm to third parties. Unexpected claims for damages can pose a serious threat to the financial position of the enterprise. Liability insurance eliminates the financial risks associated with unexpected payouts, thereby maintaining business continuity. The following types of liability insurance are distinguished in this sub-sector. Insurance of civil liability of enterprises. In these types of insurance, liability is understood as an obligation established by the law of each country to compensate for damage (harm) caused by the owners of enterprises and their employees to third parties. The insured under this type of insurance is the owner of the enterprise as a person responsible for his enterprise. Thus, the subject is the personality (status) of the insured as a carrier of civil liability arising from his role in the enterprise. Extremely relevant for Russia is environmental insurance, which is provided for by the Law "On the Protection of the Environment" in a mandatory and voluntary form (insurance of enterprises - sources of increased danger). As a rule, the following are excluded from insurance coverage: - deliberate actions; - foreseeable and unavoidable losses; - claims for compensation of damage of the insured persons to each other; - claims arising from contractual and other obligations; - gradually occurring losses (for example, constant exposure to gases, vapors, humidity, waste water, subsidence of soil due to pile driving); - claims for civil liability in respect of damage to someone else's property that the policyholder has rented, lent or which is the subject of a storage agreement or arbitrarily seized; - losses that are directly or indirectly related to ionizing radiation, etc. The company's civil liability insurer is not covered and must be insured under additional contracts risks associated: - with side activities of enterprises; - with railway and sidings; - with lease agreements (premises, persons, leased property); - with mining activities; - with losses from fire, explosion, flammable, explosive, poisonous or caustic materials; - with the activities of temporary labor collectives; - with demolition and dismantling at the construction site, as well as blasting. When calculating tariff rates, the amount of the enterprise's turnover, the annual amount of wages, the number of people employed in production, work in foreign territory, the type of enterprise, etc. are taken into account. 53. MANUFACTURERS' LIABILITY INSURANCE. PROFESSIONAL LIABILITY INSURANCE The laws of most countries provide for the liability of the manufacturer of the goods (seller, intermediary) for possible damage to the person or property of the person who uses or consumes this product. Moreover, the manufacturer of the goods (seller, performer) is released from liability only if he proves that the damage was caused due to force majeure or due to violation by the consumer of the rules of use and storage. The object of insurance of civil liability of the manufacturer of goods is his responsibility for possible damage to a person or property that arose as a result of the use of the goods produced by him. The insured event is the presence of such damage. In this case, it is reimbursed by the insurance company from the funds formed by collecting insurance premiums from manufacturers of goods. Professional liability insurance withassociated with the possibility of filing claims against persons performing their professional duties or providing relevant services. Negligence (negligence), errors and omissions made by the insured may be the basis for filing claims. Professional liability insurance can be insured responsible for both property and personal damage. The object of professional liability insurance is the erroneous actions of professionals, as a result of which events may occur that will lead to damage. Facts of dishonest behavior, deceit, criminal offenses, intentional actions of the insurers (or their employees) are excluded from the scope of the insurer's insurance liability, since professional liability insurance protects against negligence and errors in the conscientious, prudent and competent performance of their duties by the insured who has insured his liability. The premium rates for this type of insurance depend on the profession, age, length of service, date of qualification, etc. Discounts or surcharges may be applied to the basic premium rate if there were insured events in previous years for which payments were made, or if professionals only begin to work in the relevant field of activity. Some types of professional liability are subject to compulsory insurance. 54. LIABILITY INSURANCE FOR NON-PERFORMANCE OF OBLIGATIONS UNDER COMMERCIAL LOAN. OTHER TYPES OF LIABILITY INSURANCE Liability insurance for non-fulfillment of obligations under a commercial loan (delcredere insurance). Accounts receivable for the supply of goods and services can be a significant proportion of the company's balance sheet. The provision of commercial credit is an important instrument of modern market relations. The risk that, in the event of the customer's (buyer's) insolvency, receivables will have to be written off has increased greatly in recent years. Delcredere insurance, according to the classification adopted in Russia, belongs to the liability insurance industry, and in world practice - to credit insurance. Delcredere insurance subject is the risk of non-payment by customers (buyers, recipients of goods) to domestic or foreign suppliers of their receivables for the supply of goods and services. The insurer under this insurance undertakes the obligation to reimburse the debt for the buyer of the goods in return for the corresponding insurance premium. The service of the insurer is that he constantly monitors the economic and financial situation of the customers included in the insurance. Insurance case takes place in the case when bankruptcy proceedings are opened or it is rejected in court due to lack of bankruptcy estate; judicial or out-of-court proceedings have been initiated to prevent commercial insolvency; it is useless or impossible to enforce a coercive decision. The net loss (net loss) remaining after deductions from bankruptcy or insolvency quotas less deductible is indemnified. Compensation for damage is carried out within the framework of a fixed sum insured (credit limit). Under separate contracts, as a rule, insurance is carried out: - civil liability of homeowners and owners of land plots; - responsibility of builders; - civil liability of sports court owners; - responsibility of animal owners; - responsibility of hunters; - responsibility of owners of fuel tanks; - other types of civil liability. 55. ESSENCE OF REINSURANCE Reinsurance - this is a system of economic relations in which the insurer, accepting risks for insurance, transfers part of the responsibility for them, taking into account its financial capabilities, on agreed terms to other insurers in order to create a balanced insurance portfolio, ensure financial stability and profitability of insurance operations. At the same time, the corresponding share of the insurance premium is transferred. A special case of reinsurance - coinsurance, in which two or more insurers, by agreement, simultaneously accept large risks for insurance. The insurance company needs reinsurance in order to be able to cover losses on single large risks, losses as a result of catastrophic events, or losses on risks in the event of a higher than average number of insured events. In practice, it does this by taking on insurance risks in part at the expense of its reinsurers. In other words, the reinsurer provides financial support to the insurance company so that it can expand its activities. Thanks to reinsurance, the insurer is able to take on insurance more risks than without reinsurance. This gives the insurance company the ability to apply the law of large numbers and the basic insurance principle that the many must cover the losses of the few. In this way, reinsurance - a necessary condition for ensuring the financial stability and normal operation of any insurer, regardless of the size of its own capital and insurance reserves. The same purpose as reinsurance serves coinsurance, which in certain cases is more justified. In the practice of insurance, some risks, as a rule, are only reinsured, others are only reinsured. Major risks are more often insured (industrial, transport, aviation). But in mass types of insurance - insurance of cars, personal property, against accidents, etc. - only reinsurance is appropriate. СThe most important function of reinsurance is the limitation of insurance risk individual insurer. With the transfer of part of the risk to the reinsurer, the risk that the insurer himself is obliged to bear is reduced to the amount that he is ready and able to bear, taking into account his financial capabilities. Other function of reinsurance is of paramount importance for insurers who are just starting operations in the insurance market. Such insurers with the help of reinsurance can increase the amount of liability under the concluded contracts. 56. TYPES OF REINSURANCE. REINSURANCE CONTRACTS Depending on the method of transferring risks to reinsurance and formalizing the legal relationship between the parties (the insurer and the reinsurer), reinsurance operations are divided into optional и contractual. According to optional The transferring insurance company (assignor) can transfer the risks accepted by it for insurance to another insurance company using the reinsurance method. The transferring insurance company has no obligations to the reinsurer to transfer this or that risk to reinsurance. This issue is considered and resolved for each risk separately. In reinsurance, the risk can be offered in full or in part in a certain proportion, as well as one of the types of liability. In turn, the reinsurer has no obligations to the transferring company to accept the risks offered for reinsurance. By transferring the risk to reinsurance, the assignor has the right to withhold in his favor commissions, which, depending on the risk, can reach 20-40% of the gross premium and are intended to cover the costs of acquiring (accepting) insurance and its execution (agency or brokerage commission, issuance policy, establishment of accounting cards, other costs of doing business). The main disadvantage of facultative reinsurance is that, since the reinsurers have complete freedom to decide whether to accept the risk in reinsurance, by the time the insured event occurs, the risk may turn out to be not overinsured at all or partially reinsured, i.e. in an amount that does not allow the transferring company to fully compensate for losses in excess of its potential financial opportunities. Contractual relations under a reinsurance contract are mandatory, obligatory, character. A reinsurance contract defines the relationship of the parties, it describes the risks subject to reinsurance and their territorial affiliation. The contract establishes reinsurer's obligation to transfer to reinsurance "everyone and everyone" the risks accepted for insurance, and the reinsurer - to accept them on his own responsibility in the share falling on him. With an excess contract, the amount of own retention or priority of the assignor, the amount of the reinsurer's participation and the limit of his liability for each transfer are fixed. In the case of a quota contract, the share (quota) of the assignor's participation in the risks transferred to reinsurance, as well as the share of the reinsurer's participation in these risks and the limit, the maximum amount of his liability for such a share, are indicated in percent. The contract stipulates whether the assignor will send a bordereau to the reinsurer. In accordance with the contract, the reinsurer is entitled to a proportional share of the premium on the risks accepted for reinsurance. The percentage of the commission due to the assignor is determined, as well as in his favor the bonus, or commission, from the amount of profit that the reinsurer can receive, the procedure for calculating the bonus. 57. TYPES OF REINSURANCE CONTRACTS Reinsurance contracts are divided into two main groups: proportional и disproportionate. The first group includes quota and excess, or excess amount agreements, and the second group includes excess loss agreements and excess loss agreements. Quota agreement - the simplest form of reinsurance contract. According to its terms, the insurance company transfers to reinsurance in a certain proportion all the risks accepted for insurance under a certain type of insurance or a number of related insurances. In the same proportion, the reinsurer is transferred the premium due to him, and he reimburses the reinsurer for all the losses paid by him in accordance with the terms of insurance. The reinsurer has the right to a commission and participation in the possible profit of the reinsurer. The main disadvantage of the quota agreement - the need to reinsure a significant proportion of small risks that do not pose a serious danger, which the transmission company could hold on its own responsibility, retaining large amounts of premium. The determining factor in the reinsurance mechanism for excess contract is the so-called own retention of the insurance company, representing in most cases an economically justified level of the amount within which the company leaves a certain part of the insured risks on its responsibility, transferring amounts exceeding it to reinsurance. All risks accepted for insurance, the amount of which exceeds own deduction, are subject to transfer to reinsurance within a certain limit (excess) - the amount of own deduction multiplied by the agreed number of times. An important point in the organization of reinsurance is the definition of the so-called company's own retention - an economically justified level of the amount within which the insurance company retains the share of insured risks on its responsibility, transferring amounts exceeding this level to reinsurance. excess loss agreement - the most common form of disproportionate reinsurance coverage; the reinsurance instrument comes into force only if the final amount of loss on the insured risk as a result of an insured event exceeds the stipulated amount. The reinsurer's liability in excess of this amount is limited. The premium due to reinsurers is usually determined as a percentage of the annual gross premium on the protected portfolio of insurance. Excess loss agreement (stop loss agreement). The insurance company protects the overall results of the case for a certain type of insurance in case the unprofitability exceeds the amount stipulated in the contract. The purpose of the agreement is not to guarantee the transmission company a profit, but only to protect it from unforeseen losses. Reinsurers' liability limits are set within a certain percentage of loss per year or in absolute amounts. 58. CONCEPT AND STRUCTURE OF THE INSURANCE MARKET Insurance market - this is a special socio-economic environment, a certain sphere of economic relations, where the object of purchase and sale is insurance protection, demand and supply for it are formed. The objective basis for the development of the insurance market is the need to ensure the continuity of the reproduction process by providing financial assistance to victims in the event of unforeseen adverse circumstances. The insurance market can also be considered as a form of organization of monetary relations for the formation and distribution of the insurance fund to ensure the insurance protection of society, as a set of insurance organizations (insurers) that are involved in the provision of relevant services. A prerequisite for the existence of the insurance market - the existence of a public need for insurance services and insurers capable of satisfying these needs. The transition of the domestic economy to the market significantly changes the role and place of the insurer in the system of economic relations. Insurance companies are turning into full-fledged subjects of economic life. The functioning insurance market is a complex, integrated system that includes various structural units. The primary link in the insurance market is an insurance company or an insurance company. It is here that the formation and use of the insurance fund is carried out, some economic relations are formed and others appear, personal, group, collective interests are intertwined. The structure of the insurance market can be characterized in institutional and territorial aspects. В institutional aspect it is represented by joint-stock, corporate, mutual and state insurance companies. AT territorial aspect, it is possible to single out the local (regional), insurance market, national (internal) and world (external) insurance markets. Depending on the scale of supply and demand for insurance services, domestic, foreign and international insurance markets can be distinguished. Domestic insurance market - This is a local market in which there is a direct demand for insurance services, gravitating towards the satisfaction of specific insurers. External insurance market is a market that is outside the domestic market and gravitates towards related insurance companies both in the region and beyond. Under global insurance market should understand the supply and demand for insurance services on a global scale. On the basis of industry, there are markets for personal and property insurance, liability insurance and economic risks. In turn, each of them can be divided into separate segments, for example, the market for accident insurance, household goods, etc. 59. PARTICIPANTS OF THE INSURANCE MARKET. INSURANCE AGENTS Insurance market participants are sellers, buyers and intermediaries, as well as their associations. Category sellers are insurance and reinsurance companies. As Buyer policyholders act - individuals and legal entities who decide to draw up an insurance contract with a particular seller. Intermediaries between sellers and buyers are insurance agents and insurance brokers who facilitate the conclusion of an insurance contract. insurance agents - individuals or legal entities acting on behalf of the insurer and on his behalf in accordance with the powers granted by the insurance company. Insurance agents are representatives of insurance companies and act on the basis of their powers. In international practice, both individual legal entities or individuals, and persons employed by an insurance company (working under an employment contract) act as insurance agents. An insurance agent may represent one or more insurance companies and, under the terms of the contract with them, acts only on behalf of these companies. Moreover, the agent acts strictly within the powers granted to him by the insurance company. Agent Features: - providing insurers with information about the insurance company; • advising policyholders on insurance issues carried out by an insurance company, explaining to policyholders the possibilities of concluding an insurance contract with various conditions and assistance in choosing the best version of the contract in order to maximize insurance risk coverage and minimize the costs of policyholders to recover losses; • sale of insurance services to the insured: signing the insurance contract on behalf of the insurance company; • providing the insurer with accurate information about the risks accepted from the insured in order to regulate tariffs; maintenance of the insured under the insurance contract after its conclusion. The insurance agent acts as an attorney of the insurance company and performs the actions entrusted to him on behalf and at the expense of the insurer. The rights and obligations arising from the actions performed by the insurance agent in accordance with the contract concluded by him with the insurance company are acquired by the insurance company (principal). Since the insurance agent acts at the expense and in the interests of the insurance company, he is obliged to execute instructions strictly in accordance with its instructions. Agents who are not employees receive for their work, as a rule, agency remuneration as a percentage either of the amount of insurance premiums (premiums) they have collected, or of the total sum insured. insurance agents - legal entities - most often enterprises and organizations whose nature of activity makes it possible to advantageously combine the main functions with the functions of insurance agents: travel agencies, legal consultations, notary offices, savings banks, transport ticket offices that can draw up certain insurance contracts. However, it can also be organizations created exclusively for agency activities in insurance. 60. INSURANCE BROKERS insurance brokers - legal entities or individuals duly registered as entrepreneurs, carrying out intermediary activities for insurance on their own behalf on the basis of instructions from the insured or insurer. An insurance broker is an independent person acting on behalf of the insured (in direct insurance) or the insurer (in reinsurance). According to the Law of the Russian Federation "On the organization of insurance business in the Russian Federation", an insurance broker is required to undergo state registration and must be entered in the register of insurance brokers. They are obliged to send to the federal executive body for the supervision of insurance activities a notice of their intention to carry out intermediary insurance activities 10 days before the start of this activity. The notice must be accompanied by a copy of the certificate (decision) on the registration of the broker as a legal entity or entrepreneur. A prerequisite for the implementation of brokerage activities an individual and the head of a brokerage organization is the presence of higher education or secondary specialized economic or legal education with at least 3 years of work experience in the field of financial or insurance activities. Insurance brokers are encouraged to conclude insurance contracts for their professional liability to clients. Types of services provided by brokers under the Model Regulations on Insurance Brokers generally correspond to the services that insurance brokers routinely provide in the international insurance markets. However, the Regulation has some peculiarities, in particular, it refers to some difference between a broker - an individual and a broker - a legal entity: a broker - an individual cannot organize the collection of insurance premiums and insurance payments. One of the types of services provided for by the Regulations is the organization of the services of emergency commissioners, experts in assessing damage and determining insurance payments. The broker, if he has the appropriate service, which has professionals in the field of expertise in assessing the loss, may also be an emergency commissioner. But this does not mean that he can act as an emergency commissioner between the parties to the insurance contract. The regulation provides conclusion of a special agreement between the broker and his clients (insured, insurer), which lists the obligations of the insurance broker, and also stipulates the responsibility to them for their performance. Broker is not a party to the insurance contract. His duty is to facilitate the execution of the insurance contract by its participants and to provide intermediary services inherent in an insurance broker. The state can directly participate in market relations as an insurer through state insurance organizations and have an increasing impact on the functioning of the insurance market through various legal regulations.
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