The economic and social contribution of Private Insurance in modern societies

   The insurance market contributes significally to the economic, mental and physical health of modern societies’ members. Besides, it is proven that the more developed the insurance institution is the less the social problems that exist in a society.

Economic Contribution

   The insurance companies, as modern economic units, constitute a significant sector of the economy in which a great number of people is employed and it is a major source of tax incomes for the State. Simultaneously, they serve an institution with multiple positive parameters for the society’s economic prosperity, such as:

1. Damage Restoration: The restoration of any kind of damage prevents from a severe derangement of economic, enterprising, professional and social activities and assures the stability and continuity.
2. Encouragement and promotion of saving: The funds coming from insurance rates are disposable to contribute to the creation of a strong and healthy money market.
3. Investment financing: The natural outcome of savings funds is the reliable support of productive investments, which contribute to the increase of the Gross National Product and the economy growth.
4. Encouragement of enterprising initiative: Under the present circumstances of globalization and competition, the enterprising initiatives and especially the innovative and the risky ones, would be significantly reduced without the insurance protection.
5. Research and Technology development: The insurance market encourages and supports economically scientific researches relating to health issues and accident causes. Plus, it realizes the production of high technology products by reassuring obvious danger.
6. Rescue of personal, family and national resources: The Gross National Product would be significantly reduced if it weren’t for the insurance institution. The percentage of possession loss, with no hope of restoration, due to individual causes (car accidents, fire) or massive destructions (earthquakes, floods, hurricanes, volcanoes) would have been highly increased if there weren’t a restoration potential from the insurance companies.

Social Contribution

   The contribution of private insurance is really important for the health, stability and cohesion of the family, as well as for the society itself.

1. Mental Health: The sentiment of safety and calmness to modern citizens is the most important offer of the insurance institution. Oppression, pressure and anguish, some of the causes of mental and organic disorders, are drastically decreased.
2. Quality of Life: The supplement and/or substitution of social insurance in matters of health and death and in order to secure a familial income (in cases of working incompetence) as well as the restoration of every kind of material damage contribute to familial cohesion, calmness and peace. As a result the quality of life is enhanced. Moreover, it gives children and young people a base to continue their studies and a “familial fund” which facilitates the creation of their own families in the future.
3. Maintenance of assets and incomes: In case of accidents and long-term diseases, compensations ensure (partly if not totally) the economical self-sufficiency of the family and prevent the increase of social problems. The compensations of property destruction prevent the marginalisation of ex- prosperous families and the creation of families suffering from economical problems.