InsuranceThe examples and perspective in this article or section may not represent a worldwide view. Please improve the article or discuss the issue on the talk page.
Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of potential financial loss. Insurance is defined as the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a premium and duty of care.
Principles of insurance
From the point of view of the insurance company there are four general criteria for deciding whether to insure events or not. Attempts to improve public understanding of insurance -- what it does and how it
Losses must be uncertain.
The rate and distribution of losses must be predictable: To set premiums (prices) insurers must be able to estimate them accurately. This is done using the Law of Large Numbers which states that: The larger the number of homogenous exposures considered, the more closely the losses reported will equal the underlying probability of loss. Site includes many useful calculators and tools, an agent locator,. If the coverage is unique, the insured will pay a correspondingly higher premium. Lloyd's of London often accepts unique coverages. (e. g.Home atl car che col fam hea heal healt health hum ind mar onl you