Insurance is protection against a specific loss, such as fire, wind, etc., over a period of time that is secured by the payment of a regularly scheduled premium. It’s a risk management tool that protects an individual from specific financial losses under specific terms and premium payments, as described in a written policy document.
Insurance is appropriate when you want to protect against a significant monetary loss. Insurance allows individuals, businesses and other entities to protect themselves against significant potential losses and financial hardship at a reasonably affordable rate.
Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.
The types of insurance exist are: