The Objective of Insurance and Claims :-

The objective of insurance is to cover the impact of loss (e.g. equipment damage in a factory) from any unfortunate event (e.g. fire).For the insured, the minimization of loss is through claiming the amount due to loss from the insurer. For the insurer, the larger interest is in reducing the extent of loss itself (to avoid large claims) and reduce its own claim exposure through reinsuring its insurance portfolio. Reduction in claim instances and claim amounts benefits the insured as well as insurer since the premium for covering such risks gets reduced. Insurers and insured thus work towards deploying practices, processes and technologies which reduce the risks and minimize the occurrence of loss events. The insurers offer premium discounts to insured if risk minimization measures are put in place and if there have been no history of claim in past