The concept of insurance can be simply stated as a contract of indemnity or an assurance to a person, group or a body to indemnify a specified loss fatal, physical or financial, or, to indemnify any specified damage to property or assets owned by him or them upon occurrence of an event.
The person or persons so assured is/are the `insured' and the entity that makes such an assurance is the `insurer'. This concept of evaluation of the damage and determination of the compensation, i.e., the insurance activity, is a couple of centuries old in India. According to the information from a research in TKM Institute of Management Kollam, Kerala, on the subject of insurance in India, the insurance activity is said to have begun in India as early as the second decade of the 19th century with the then British company, Oriental Life Insurance, which offered insurance services.
As can be seen, initially, it was a business carried out by the private sector, and, with the nationalization nearly five decades ago, it became an activity performed by the public sector in India. However, in the wake of liberalization and globalization, the private sector was allowed once again to jump into the fray.
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