Page 13 - Insurance Surveyors Book Ebook IC S01

Survey And Loss Assessment IC-S01

But when such aspects are lost or destroyed much before the expected date, the

calamity is suffered. Human being is an income generating asset. He expects to earn

during his life time sufficiently so as to provide for his old age. But when he dies at a

young age, the family remains unprovided for. A motor vehicle is to last, say 15

years.

During this period, the owner makes sufficient saving as to replace it with a new one.

But if the vehicle is totally damaged due to an accident, the entire capital is lost and

the owner cannot replace it. It is so with any other asset.

Individual's income is dependent upon the investment of his time. Over a period of

time, he saves sufficiently to provide for the time, when he is too old to earn. But

nobody can guarantee him this time. This uncertainty of time leads him to the

invention of insurance.

The story goes off a news paper hawker boy who used to go on cycle to distribute

news papers to earn his livelihood. One day, when he left his cycle outside a house

and went in to deliver the news paper, his cycle got stolen. He had thereafter no

means to run around. Walking would be a slow process and his income would

dwindle. The boy was a smart one.

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