Read the given passage and answer the following questions.
Insurance is a cover used or protecting oneself from the risk of a financial loss. It is important to understand that risk is a part of any person’s life and that it increases as a person increases in age, responsibility, and wealth. Insurance is risk coverage against financial losses and should not be taken as an investment instrument. There are mainly two parties involved in this- the insurer and the insured. The insurer is the insurance company that will provide cover to the insured against any financial losses. The insured may be an individual person or a group of people like an employer, members of society, etc.
The story of insurance is probably as old as the story of mankind. The same instinct that prompts modern businessmen today to secure themselves against loss and disaster existed in primitive men also. They too sought to avert the evil consequences of fire and flood and loss of life and were willing to make some sort of sacrifice in order to achieve security. Though the concept of insurance is largely a development of the recent past, particularly after the industrial era-past a few centuries yet its beginnings date back almost 6000 years.
Life Insurance in its modern form came to India from England in the year 1818. Oriental Life Insurance Company started by Europeans in Calcutta was the first Life Insurance Company on Indian soil. All the insurance companies established during that period were brought up with the purpose of looking after the needs of the European community and Indian natives were not being insured by these companies. However, later with the efforts of eminent people like Babu Muttylal Seal, foreign life insurance companies started insuring Indian lives. But Indian lives were being treated as sub-standard lives and heavy extra premiums were being charged to them. Bombay Mutual Life Assurance Society heralded the birth of the first Indian life insurance companies in the year 1870 and covered Indian lives at normal rates. Starting as Indian enterprises with highly patriotic motives, insurance companies came into existence to carry the message of insurance and social security through insurance to various sectors of society.