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[QUOTE="Mataracy, post: 144031, member: 28733"] In a small firm,the security from loss which insurance provides means that losses which would be crippling to the small firm, although insignificant to a larger firm, can now be faced with confidence. Even in the larger firm, the executives can concentrate on the proper function of running an efficient enterprise. They can concentrate on the production and trading risks without the worry that the objectives in these fields may not be achieved due to fire or other insurable risk. Several writers are of the opinion that insurance helps to bring about a closer approach to an optimum allocation of the factors of production and hence optimum allocation of the factors of production and hence optimum price levels. Frequently those wishing to invest in new projects will only do so if the maintenance of adequate insurance cover is written into the construction contract. International trade is stimulated also as a marine cargo policy is one of the documents which, along with a latter of credit, bill of lading, bill of exchange and export invoice, is essential to enable the seller if goods to ask his bank to discount the bill of exchange and so obtain funds immediately, instead of having funds tied up in cargo on the high seas. [/QUOTE]
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