ABSTRACT

Insurance is a contract by which one party for a consideration called premium assumes a particular risk of the other party and promises to pay him or his nominee a certain or ascertainable sum of amount on a specified contingency. It can be categorised into life insurance and General Insurance. Life insurance or life assurance, is a contract between an insurance policy holder and an insurer or assurer, where the insurer promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a premium, upon the death of an insured person i.e. the policy holder. While the General insurance which includes – marine, fire,motor, burglary,personalaccident,and cropetc to protect people from various uncertainties in life. IRDA Act has been established in India to regulate and check the working of  these companies in order to protect the interest of common people But some problems are faced by insurance companies also  for example  maintaining funds in hard economic times,solvency, reducing costs, maintain goodwill,providing satisfaction to customers, weakness of insurance sector, poor quality of services, need for automation, less availability of insurance products, inadequate penetration into businessThe insured does not have any say in establishing the terms and condition of policy and has to adhere to policy terms as drawn by the insurer. Simplification and usage of local language to explain the insurance covers with policy literature can bring comfort to the policy holders. It will help buyers accept the terms and conditions with clear understanding of the benefits and the exclusions Instead of being a source of comfort in a crisis situation, the claim settlement process should not become an additional source of trouble to an already bothersome situation