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This case study developed based on hypothetical life events of Mr. Subash. This case will serve as a reference for the practical application of insurance as a risk management tool for various life events of an individual.  Every part of our life risk is inherent and effective management of risk is most essential. Risks can be manage through various methods: 1. Risk control: steps taken to minimize risk, 2. Risk avoidance: risk eliminated by avoiding the risk altogether 3. Risk retention: deciding to simply accept and pay for any loss himself/herself and 4. Risk transfer: where through contract, the risk is transfer to another party.

Life events of Mr. Subash:
  • Mr. Subash lives in Chandigarh and studies B.Com at Punjab University in the year 1977 by taking an education loan.  He was a part of NCC and active player in Cricket participated in various tournaments. He was graduate in the year 1980 at the age of 21, with a B.Com.
  • Upon graduating, he found a job in the field of relationship Management and joined the reputed company: ABC Ltd as Relationship Manager at Amritsar, Punjab location. After 3 years with the firm, he transferred to their Gandhinagar, Gujrath branch as a Senior Relationship Manager. He leases a flat in the high-end area and moves in.
  • Mr. Subash was an avid cricket player, continued to playing after gaining employment and now plays for his company as well as club in Gandhinagar, Gujrat. He often get injuries during the match or practice session to the office.
  • 1985 he married Ms. Lakshmi who lives in Nagpur. Graduated from Mumbai University in 1980 at the age of 20 in Commerce discipline.  She is into hobby trekking and continued as a professional trainer.
  • In 1986, they decided to move to new house in posh area and spends Rs. 1, 25,000 on household expenses with the borrowed a money from a prestigious bank. In the same year their son Rakesh was born.  Ms. Lakshmi takes a break from professional training job to bring up the son.
  • 1987, he was transferred to Hyderabad with the same company with and during the time Rakesh was hospitalised due to ill health  and it took Rs. 70,000 as hospitalisation expense.
  • In 1988 decided to start his own business and developed a transportation business. He borrowed Rs. 3, 00,000 to finance his business. Because of tremendous contacts, he made good progress in business initially and subsequently made huge losses and planned to close down business.
  • In 1990, their son started education in one of the reputed international school, which cost Rs. 50,000 as donation.  As Lakshmi is a single girl child, their parents retired from private jobs both in laws expenses to be taken care by Mr. Subhash.
  • In 1992, he shifted to XYZ Company as a Branch Manager in Hyderabad with good package and next year bought house by taking a loan of Rs. 7, 00,000 and paid advance money of Rs. 1, 00,000 out of his salary savings.
  • 1995, he enrolled in the  Master of Business Administration by withdrawing all his Provident fund amount and the same year his father was hospitalised at the age of 65 and spent heavy amount on hospitalisation expenses and died in 1997.
  • After his education, he shifted to Delhi and placed as a Senior Manager in Transportation Company.  During 2004 son started engineering education with reputed engineering college.
  • In 2004, Subash got into teaching profession with Management institute and shifted to Jaipur institute of Management in 2006. 
  • Rakesh did not take up the job after completing studied.  Rakesh started small company, which is into software development in 2008, after 4 years joined, HP a reputed Software Company in Bangalore, and married Vidya.  In 2012 relocated to Bangalore with son and completed his PhD in 2013. Mrs. Lakshmi undergone some medical treatment in the same year and he retires from job in 2016. 
  • Rakesh got baby girl child and kid is healthy, due to old age of mother Mr. Subash has to take care of mother for life. After retirement, Mr. Subash is dependent on little savings


Significance event
Risk exposure
Possible risk Mitigation
Education loan  and sports activity
Injury, Loan commitment
Risk retention
Risk  avoidance
* Participate in activities and accept the possible loss.
* Not to involve in other activities

Job and cricket playing continued

Personal death, loss of income, disability + medical expenses
Risk transfer
Life insurance (accident), medical insurance, income protection insurance.
Marriage and both begin professional career
Personal death, professional liability, business liability
Risk transfer
Term insurance, professional indemnity insurance, medical insurance  (if not covered by employer)
Son born + hospitalised , posh house and break from training of wife
Additional burden personal risk, posh house expenses
Risk control
Risk Transfer
*Take care of infection
* Property damage insurance/ householders insurance.
Business started and shut down on early.
Business liability, loan/ liability
Risk transfer
Business insurance/ employee liability, protection against loan
Sons education and in law expenses
Increased dependency- education and in law dependency
Risk transfer  Risk retention
* Insurance with savings/investment
* Medical expenses for old aged
House construction
Property risk/damage
Risk transfer
* Householder insurance
Sonโ€™s education and education for self, fatherโ€™s hospitalization
Increased cost of fund and hospital expenses
Risk retention
* Retain risk and fund through own sources.
Lakshmi falls ill
Personal risk
Risk control
* Screening and preventive measures
2016 later
Retirement risk
Risk transfer
Risk control

* Onetime payment towards retirement Insurance
* Not to involve in any risky activities during retirement.