Insurance Definitions

The promise of compensation for the losses in the future a certain potential in exchange for periodic payments. This insurance is designed to protect the financial welfare of an individual, corporation or other entity in the case of unexpected losses. Some forms of insurance are required by law, while others are optional. Approving the terms of an insurance policy creates a contract between the insured and insurance. In exchange for payments from the insured (called premiums), the insurance agreed to pay the policy holder a sum of money for the occurrence of certain events. In most cases, the policyholder pays a part of the loss (called the deductible), and the insurance pays the rest. Examples include car insurance, health insurance, disability insurance, life insurance, and insurance business.