BENEFITS OF INSURANCE IN ALGERIA

Numerous benefits exist why you should buy insurance benefit in Algeria. We will hereunder discuss some of the fundamental benefits of insurance. The basic benefit of insurance coverage includes but not limited to the following:

1. Protection against risks
2. Serves as means of Risk Sharing
3. Provides Peace of Mind
4. Risk valuation
5. Economic Growth
6. Ensures Financial Stability
7. Means to Capital Generation
8. Legal Requirement compliance
9. Tax Benefits
10. Eliminates Financial Dependency
11. Maintains Standard of Living
12. Promotes Saving Habit
13. Means to Grants and Loans

 Protection against risks

The major function of insurance is the protection against risk connected with unforeseen events. This is because the nature of man is such that we cannot foresee when we will be incurring losses but these losses happen from time to time. And the occurrence of these risks and the losses are of the nature that we do not have control over its happening.

It is as a result of these risks and the losses it brings that insurance policy exists to provide protection when we encounter these unfortunate unforeseen incidents.  However, worthy of note is the fact that Insurance coverage does not serve to reduce the extent of loss we encounter but to provide monetary reimbursement or indemnity in the happening of the insured risks.

Serves as a Means of Risk Sharing

The working of Insurance is such that it is akin to form of a savings or a cooperative scheme. What it entails is that the insurer insures a lot of people who pay premiums and the premiums are put together by the insurer in the form of financial pool. Therefore, since it is impossible for all policyholders to encounter the insured risks at once, a part of the pooled premiums is used to indemnify a policyholder who has suffered the risk.

Provides Peace of Mind

Having an insurance policy provides the policyholder with maximum peace of mind. This peace of mind comes from knowing that your future is guaranteed in the circumstances where the risks for which you have insured happen to you.

Risk Valuation

This is also one of the benefits of insurance policy. Here it functions as a means of proper assessment of the nature of risks the prospective policyholder is exposed to and its probable causes.

The risk valuation will also cover the amount of premium payable with respect to the risk. The benefit of insurance in this respect is the safeguard against uncertain unforeseen perils and the consequent losses.

Economic Growth benefits of insurance in Algeria

This benefit of insurance comes to fore when insurers turn their premiums into productive investment. The opportunities made available by these investments are enormous. And as such, Insurance companies hold significant stakes in the areas of estate management, banking, Tourism and the hospitality industry, reinsurance business and others.

Similarly, Insurance Companies promote saving culture amongst people, commerce and trade and by so doing, encourage financial stability as well as economic development.

Ensures Financial Stability

Insurance policies also serve the benefit of guaranteeing financial stability to a policyholder. Monies that could have been lost to happening of a risk to a policyholder is taken care of by the insurer by way of payment of indemnity.

Similarly, the Insurance companies also play significant roles in the stability of the larger financial systems. This they do by their huge investments in the financial markets by brokering links between the Policyholders and the banks. And as well ensure the financial stability of the homes through the insurance of their risks.

Means to Capital Generation

Insurers generate capital from the various premiums from policyholders. These funds from the various premiums serve as a pool for the insurance company who invest same and realize huge profits from such investments thereby generating more capital.

 Legal Requirement Compliance

There are some types of insurance policies that are made compulsory by the laws of the country. An example of such insurance policy legally mandatory is the Third-Party Motor Insurance.

Similarly, some government regulations require the existence of insurance coverage for certain risks to access benefits from them.

Tax Benefits benefit of insurance in Algeria

Governments sometimes provide tax relief available to only people with certain insurance coverage.

Eliminates Financial Dependency as benefits of insurance

Insurance policies such as the life insurance help families to bounce back financially independent after the death of the breadwinner of the family. This is because the death benefits will be paid to them as beneficiaries and In this sense, they don’t have to worry about living expenses.

 Maintains Standard of Living benefit of insurance in Algeria

This comes from the level of protection provided by insurance companies. Insurance provides the policyholder with a level of protection that ensures that his standard of living is not compromised after encountering loss.

Encourages Saving Habits

This they do by keeping a part of income to pay premiums that will act as a guard for unknown future perils.

Grants/Loan benefit of insurance in Algeria

Some loan companies insist that one must have a certain insurance cover to be eligible to the grant of loan in deserving circumstances.

Conclusion

The core benefit of having insurance is the provision of indemnity in the happening of the insured peril. And thereby prevents you from spending out of our pocket. It further provides us with financial assistance for our losses and damages when they occur. It is therefore advisable that we buy into insurance to enjoy the benefits associated with it.