INSURANCE- Financial Protection Against Loss or Harm

Insurance is vital to a free enterprise economy. It protects society from consequences of financial loss from, accidents, sicknesses, damage to property, and injury caused to others.

The insurance System works where individuals/companies (the insured/policy holder), pays relatively small amounts,(the premium), to an insurance company,(the insurer), who then in return issue an insurance policy in which the insurer agrees to reimburse the insured for any losses covered by the policy. The insurer profits by investing the premiums it receives. Some common forms of insurance cover business risks, automobiles, homes, boats and health.

In a broad economic sense insurance transfers risks from the individual to a larger group, which is better able to pay for losses.

Advancing technologies and a dynamic marketplace constantly change society’s insurance needs. The Insurance industry’s goal is to respond to those needs with available and affordable insurance.