Insurance kya hota hai , iske kya fyade hai ?

    Insurance wow that was um that was probably one of my more exciting words to start this video with um so we're going to talk about insurance today and i promise i'm going to do my best to make this really interesting um maybe but uh if you want to learn how insurance works stay tuned because that's what we're talking about but Back to the video insurance it's the annoying necessity that we all pay for to make sure we don't end up in massive amounts of debt if our house burns down if we crash our car or if something tragic happens insurance helps us maintain peace of mind knowing that even if something bad does happen someone else is going to pay for what it costs to fix it though to an untrained eye .

 This can be a little perplexing i mean if you pay 200 a month for home insurance and after only six months your home burns down the insurance company will buy you a new house likely in the matter of hundreds of thousands of dollars but you would have only given them 1200 why would they do that that's the power of insurance baby the basic concept of insurance is that a  company the insurer offers a guarantee for a certain risk that may or may not occur then another party the insured pays the insurer in exchange for protection against that risk when a bunch of people do the same thing for the same risk eventually the insurer is getting a lot of income but the probability of that risk .

 Happening is spread out among a bunch of people and stays about the same insurance companies make money by figuring out how much money they need to bring in to turn a profit on a given risk with a given probability that calculation then influences how much each of the insured pays each month in general it's simple math but in actuality insurance companies have highly complex models for all of this is not every insurance company offers the same insurance most insurance companies will specialize in their own kind of insurance this is because each company has to develop a complex model to ensure that they can make money insuring a profit if you estimated that 1 in 100 houses burned down each year but it was actually 5 in 100 .

 Then you'd be losing money pretty fast if you insured those houses you'd probably charge too little for everyone's insurance and then end up on the hook for those four extra houses there are many types of insurance companies from auto to health to life to homeowners most people in the world have these core insurance policies some of which are legally required to be held like auto insurance you might be wondering .

 Though why wouldn't you just want to save your money each month get to hold on to it in a bank account then if nothing bad ever happens you have a lot more money well while that may be true it makes you the one exposed to the risk if you put away 200 a month for a year to save on home insurance you'll have an extra 2400 at the end of the year .

 However if your house burns down the next year well then you're going to be out the few hundred thousand dollars that it's going to take to fix it a pretty bad deal is that a risk you're willing to take chances are it isn't that's why getting insurance is generally a good thing it takes all of the risk and anxiety and financial burden off of .

 You and puts it onto a much larger company that can afford it when you understand insurance as just a way of paying a company to assume your risk you can start understanding that insurance could in theory be offered on virtually anything anything are you worried that while you're toasting a cinnamon raisin bagel your toaster will overheat one of the raisins causing it to burst into a .

 Spontaneous plasma and destroy your entire pantry full of stockpiled bags of lucky charms and baked beans well that's oddly specific but someone could probably insure you for that exact thing likewise maybe you're really attractive and worried that if you fall one time you're going to hit your face stop being attractive and be depressed .

 Because no one will like you anymore well somebody could probably insure you against that 2. this isn't too far off of reality either celebrities will often have parts of their body insured because their image is a source of their income there's a few more pieces to the puzzle here though and we should talk about reinsurance and insurance claims .

 Policies on their insurance policies to protect them from high losses in case all their houses they ensure just burst into flames because global warming and whatnot then all the risk is all on the reinsurance agency this is a necessary thing two think if an insurance company insured everyone in florida's cars but then a hurricane came through and destroyed all the cars .