Types of insurer defined by function

Question 1

Composite companies

Answer 1

Deals with lots of different types of business (motor, travel, commercial) and represents the majority of the insurance market

Question 2

Specialist companies

Answer 2

Deals with one class of business

Question 3

Takaful companies

Answer 3

Insurance based on the rulings of Sharia law and works on the principle that any transaction of risk and profit should be shared between the participants

Question 4

The state

Answer 4

UK government ensures adequacy of insurance coverage by creating laws to make certain insurances compulsory. State also acts as an insurer itself in areas of social services (welfare and pension provision). It also acts as a guarantor to the insurance sector as a whole regaridng risks such as terrorism