Many people in South Africa see insurance companies as expensive an unnecessary. This is largely due to a lack of knowledge about the insurance industry. Like all business, insurance companies work by making a profit. An insurance company makes money by charging premiums to clients. A portion of the premium is used for pay-outs. Insurance companies rely on insurance administration software to assist them with the insurance system. If you have car insurance you will be paid if, you are in an accident or if the car is stolen. If you have home insurance you will be paid if your house is damaged or destroyed, and life insurance pays out money to clients relatives when that person dies.

Life insurance is when you buy a term life contract, you are required to pay certain premiums for a sometime, and if you die within that period, your family will be compensated. Insurance companies use life insurance software solutions to determine different packages. Insurance will also use financial software solutions which will help them balance the books, because if expenses are higher than income the company will fail.

Some advantages of life insurance and other insurance:

Insurance helps give you peace of mind. You know that if an accident happens you have insurance to back you. It works as an investment product for your family because if you pass away you know they are looked after.

It gives people the confidence they need to purchase expensive items. Imagine a world in which expensive items were simply ignored if they were damaged or lost. People would not purchase homes, cars or other big ticket items that keep the economy moving. People would be too afraid to lose what they have worked so hard for.

As you can see insurance companies have great impact on how we live, therefore insurance cannot be overlooked as just another expense but as a support system. This is why it is important that every South African has insurance.