Many definitions have been given to the term insurance, which in passing there is no similarity between the definition of each other. This is understandable, because they are defined according to the perspective that they use in looking at insurance, which in accordance with the above description that insurance can be viewed from several angles.
Definition-definition include:
1. Definition of insurance by Prof. Mehr and Cammack:
"Insurance is a means to reduce financial risk, by way of collecting exposure units in sufficient numbers, to make for individual losses can be estimated. Then a predictable loss was borne equally by those who joined."
2. Definition of insurance by Prof. Mark R. Green:
"Insurance is an economic institution which aims to reduce risk, by combining the management of a number of objects in a large enough amount, so that the overall losses can be predicted within certain limits."
3. Definition of insurance by C. Arthur Williams Jr. and Richard M. Heins, which defines the insurance on the basis of two viewpoints, namely:
- "Insurance is a security against financial loss by an insurer."
- "Insurance is an agreement by which two or more persons or entities to raise funds to cover financial loss".
Based on these definitions above would be about the definition of insurance that can cover all points of view:
"Insurance is a means to reduce the risk inherent in the economy, by way manggabungkan number of units exposed to the risk of the same or nearly the same, in large enough quantities, so that the probability of loss is predictable and if the predicted loss occurs will be divided proportionately by all parties in the joint. "
"Insurance is a means to reduce the risk inherent in the economy, by way manggabungkan number of units exposed to the risk of the same or nearly the same, in large enough quantities, so that the probability of loss is predictable and if the predicted loss occurs will be divided proportionately by all parties in the joint. "