List FIVE benefits of insurance to an economy. – NABTEB QUESTION

Benefits of insurance to an economy:

(i) It is a safeguard against the numerous risks to which capital is exposed.

(ii) It reduces the burden of losses to the entrepreneur

(iii) It gives the entrepreneur the confidence and provides him the security needed to venture into certain areas.

(iv) It promotes bilateral and multilateral trade

(v) Insurance companies are a good source of capital for investment.

(vi) A life assurance policy can be used as a collateral to raise a bank loan needed for investment or business expansion.