When you have finished this chapter, you should be able to
As a part of our study of the insurance mechanism and the way it works, it will be helpful to examine some of the unique facets of insurance company operations. The unique nature of the insurance product requires certain specialized functions that do not exist in other businesses. In addition, financial record keeping of insurers deviates from common practices. In this chapter, we will examine some of the specialized activities of insurance companies, and in the next we will look at the financial aspects of their operations.
Although there are definite operational differences between life insurance companies and property and liability insurers, the major activities of all insurers may be classified as follows: