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What Is Insurance: Understanding and Benefits

Everyone who wants to protect themselves or others against financial difficulties should consider insurance. This may include:




  • Protect the family after the death of a person from loss of income
  • Ensuring debt repayment after death
  • Includes contingent liabilities
  • Protects against the death of key employees or people in your business
  • Protect your business from business interruptions and loss of revenue
  • Protect yourself against unexpected health costs
  • Protect your home against theft, fire, flood and other hazards
  • Protect yourself against lawsuits
  • Protect yourself in terms of disability
  • Protects your car against theft or loss caused by accident.
In addition there are many more reasons someone must have insurance. a large group of people who want to insure against certain losses pay their premiums to insurance companies. 

Because the number of people insured is so large, insurance companies can use statistical analysis to project what their actual losses will be in a particular class.

They know that not all individuals who are insured will suffer losses at the same time or at all. This allows the insurer to operate profitably and at the same time pay claims that may arise.  


For example, most people have car insurance but few actually get into an accident. You pay for possible losses and for the protection you will be paid for the loss in the event of any.
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