Functions and Types of Insurance in Indonesia, Financial Management for the Future

RUMAHBERSIH.ID – Most Indonesian people are familiar with insurance. However, not a few also do not know the functions and types.

Thus, many people who do not understand and understand the functions and types of insurance do not have it.

Simply put, the meaning of insurance itself is a person’s financial management both for himself and for his family in the future.

This is a savings when something unexpected happens in the future involving money.

In practice, insurance is the intention or agreement of two parties, namely the insurer and the insured.

The insured here is someone who pays contributions to the insurer who then if something happens in the future will be compensated according to the type of insurance that he participates in.

Broadly speaking, the function of insurance is divided into two parts, namely the primary and secondary functions.

The following is an explanation of the functions and types of insurance in Indonesia.

Insurance Function

a. Primary Function

Broadly speaking, the primary function is a mechanism for transferring risk from the insured to the insurer.

This is in the event of loss or damage experienced by the insured to the insurer by paying premium contributions.

b. Secondary Function

While the secondary function is as a stimulus for economic and business growth, preventing losses, controlling losses and as a savings or investment in the future.

The types of insurance in Indonesia are as follows:

  1. Types of Motor Vehicle Insurance

Types of motor vehicle insurance are contained in the law article 256 of the Criminal Code

  1. Type of Accident/Fire Insurance
  2. Life Insurance

The life insurance policy is contained in the law article 25 of the Criminal Code.

  1. Types of Health Insurance
  2. Types of Education Insurance
  3. Types of Investment Insurance
  4. Types of Corporate Insurance
  5. Types of Old Age Insurance

That is the meaning, function and types of insurance in Indonesia.

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