(i) Life Insurance may be defined as a contract in which the insurance company called insurer undertakes to insure the life of a person called assured in exchange of a sum of money called premium.
(ii) The premium may be paid in one lump sum or monthly, quarterly, half yearly or yearly.
(iii) The Insurance company in consideration promises to pay a certain sum of money either on the death of the assured or on expiry of certain period.
Importance of Life Insurance :
1. Life insurance provides protection to the family at premature death of an individual.
2. It gives adequate amount at an old age when earning capacities are reduced.
3. Life insurance is not only a protection but is a sort of investment because a certain sum of money is returnable to the assured at the time of death or at the expiry of a certain period

(i) Fire insurance is a contract whereby the insurer, in consideration of the premium paid, undertakes to make good any loss or damage caused by a fire during a specified period up to the amount specified in the policy.
(ii) A claim for loss by fire must satisfy the following two conditions :
(1) There must be actual loss; and
(2) Fire must be accidental and nonintentional.
(iii)The Essential elements of Fire Insurance Contract are:
(1) The insured must have insurable interest both at the time of insurance and at the time of loss.
(2) The contract is based on utmost good faith.
(3) It is based on the principle of strict indemnity,
(4) Fire must be the proximate cause of damage or loss.

IRDAI - Insurance Regulatory Development and Authority is the statutory, independent and apex body that governs, regulates and supervises the Insurance Industry in India. It was constituted in the year 2000 by Parliament of India Act called IRDAI Act, 1999. Presently IRDAI headquarters is in Hyderabad.

Crop Insurance:
This policy is to provide financial support to farmers in case of a crop failure due to drought or flood. It generally covers all risks of loss or damages relating to production of rice, wheat, millets, oil seeds and pulses etc.

"Insurance is a plan by themselves which large number of people associate and transfer to the shoulders of all, risk that attaches to individuals" - According to John Magee.

Essential elements of Marine Insurance Contract:
(i) It is based On the principle of indemnity.
(ii) The contract is based on utmost good faith.
(iii) The insurable interest must exist at the time of loss.
(iv) The principle proximate cause will apply to marine loss only

In some cases, the insured may not be in a position to continue his policy. On such occasion, if the policy is in force for atleast three years, the insurance company offers the chance of surrendering the policy. The surrender value is the amount of premiums paid which is returned to the policy holder if he decides to terminate the contract.

Proximate means nearest. It is only the nearest reason and not the remote reason which is taken into account. The insurer is liable to compensate only if the nearest cause comes within the meaning of risk involved.

When more than one insurance policy is taken to cover the same subject matter, it is known as double insurance.

(i) In case of Double Insurance, the same subject matter is insured by the insured with two or more insurers.
(ii) But in the case of re-insurance, the insured insurers the subject matter only with one insurer.

General insurance include all different types of insurance like fire, marine, burglary, crop and miscellaneous insurance business, except life insurance. It does not include redemption business and annuity business. It is a contract of indemnity. Value of the subject matter can be easily determined and the insurer pays the compensation for the loss suffered. This contract is for short period i.e., one year. The loss due to riskis not certain. It may happen or may not.
The types of general insurance are:
(i) Fire Insurance: It isa personal contract between the insurer and the insured. It includes floating policy. Declaration policy and Reinstatement policy against fire.
(ii) Marine Insurance: It is the most important and challenging branch of insurance. Under this, the insurer indemnities the insured against marine losses. It is include cargo insurance, Hull insurance and freight insurance based on the subject matter policy. On the basis of duration and terms various marine policies are undertaken.
(iii) Burglary Insurance: It comes under insurance of property. The loss of household goods, thefts, house-breaking are compensated through burglary insurance.
(iv) Medical Insurance or Mediclaim: The insurance companies pays for the hospitalisation, domiciliary hospitalisation, .surgery or related medical expenses. Under mediclaim with personal accident insurance the maximum benefit can be Rs 1,50,000 and in 'without personal accident' scheme the amount is Rs 96,500.
(v) Crop Insurance: The State Government - set up state crop insurance funds. It is decided in consultation with the state government, Ministry of Finance and Ministry of Agriculture of the Central Govt., for each state.
(vi) Motor Vehicle Insurance: Under motor insurance, the owner's liability to compensate people affected by the negligence of the driver is passed on to the insurance company. Avariety of policies like 'Act only' policy,and 'Comprehensive Policy' are available.
(vii) Third-Party Insurance: The third party policy covers third party damage over and above the limits specified in motor vehicle Act. This policy is operative when the accident occurs both in public places and in private places.

Section 14 of IRDAI Act, 1999 lays down the duties and functions of IRDAI:
1. It issues the registration certificates to Insurance Companies and regulates them.
2. It provides license of insurance to intermediaries such as agents and brokers after specifying the required qualifications and set norms/code of conduct for them.
3. It promotes and regulates the professional organizations related with insurance business to promote efficiency in insurance sector
4. It regulates and supervises the premium rates and terms of insurance covers.
5. It specifies the conditions and manners, according to which the insurance companies and other intermediaries have to make their financial reports.
6. It regulates the investment of policyholder's funds by insurance companies.
7. It also ensures the maintenance of solvency margin (company's ability to pay out claims) by  insurance companies.

(i) Motor Vehicle Insurance:
(1) This is also known as 'Auto Insurance'. This policy comes under General Insurance. This insurance has become very popular and is gaining importance.
(2) In motor insurance the owner's liability to compensate people who were killed or injured by an accident is passed on to the insurance company. The premium rate under this policy is standardized.
(ii) Burglary Insurance :
(1) This policy comes under the category of insurance of property.
(2) Any loss of damage due to theft, larceny, burglary, house-breaking and acts of such nature are covered by this policy. Actual loss is Compensated.
(iii) Cattle Insurance :
(1) This is a bond in which a sum of money is secured to the insured in case of an event of death of animals like bulls, buffaloes, cows and calves.
(2) The cause of death may be an accident, disease or pregnant condition, etc. The insurer normally agrees to pay excess in case of loss.
(iv) Crop Insurance :
(1) This policy is to provide financial support to farmers in the case of crop failure due to drought or flood.
(2) It generally covers all risks of loss or damages relating to production of rice, wheat,millets, oil seeds and pulses etc.
(v) Sports Insurance:
(1) This policy is a comprehensive cover for amateur sports persons regarding their sporting equipment, personal effects, legal liability and personal accident risks.
(2) The cover is generally for following sports or more : Angling, badminton, cricket, golf, lawn tennis, squash and use of sporting guns etc.
(vi) Amartya Sen Siksha Yojana:
The General Insurance Company offered to secure the education dependent children under this policy.
(vii) Rajeswari Mahila Kalyan Bima Yojana :
This policy is to provide relief to the family members of insured women in case of their death or disablement due to any kinds of accidents and/or death and or disablement arising out of other factors incidental to women only.

(i) Speculative Risks:
(1) Speculative risks are the kind of risks which have the possibility of gain as well as the possibility of loss. Such risks are the result of market conditions.
(2) Favourable market conditions result in gains whereas unfavourable market conditions result in losses.
Example: Use of better technology helps to produce better quality products at cheaper prices. This may increase the demand and thus result in higher profits.
(ii) Pure Risks:
Pure risks are the type of risks where business suffers loss only if the risk occurs. Non-occurrence of such risks leads to absence of loss.
(iii) Insurable Risks:
(1) Insurable risks are the type of risks where business can insure the probable losses by paying a predetermined premium to an insurance company.
(2) At the time of loss the insurance company pays compensation on the basis of agreed terms and conditions.
(3) Loss arising due to natural and physical risks can be insured as the probability of risk can be determined.
For Example:  Company can insure its stock against fire or theft and if it loses its stock due to fire or theft in office, the insurance company pays compensation for the value lost.
(iv) Uninsurable Risk:
(1) Losses arising from unforeseen natural events, political changes or trade cycles are called uninsurable risks.
(2) Loss due to earthquake or flood or cyclone cannot be estimated and their probability cannot be calculated. Government directly takes care of the affected persons.
(3) Losses to businesses due to policy decisions of ruling political parties in a country, or due to economic depression cannot be insured.
(4) These uninsurable risk events are called uncertainties. The concept of risk is different from uncertainty. During uncertain events decisions cannot be taken.