Insurance company

Insurance Company

An Insurance Company (pronunciation: /ɪnˈʃʊərəns kʌmp(ə)ni/), also known as an insurer, is a financial institution that provides insurance coverage. The etymology of the term "insurance" comes from the Middle English word "ensuren" which means to make certain.

Definition

An insurance company is a business entity that provides various types of insurance policies to individuals and businesses. These policies are contracts (insurance policies) that promise to pay for specific potential future losses incurred by the policyholder in exchange for periodic payments known as premiums.

Types of Insurance Companies

There are several types of insurance companies, including:

Function

The primary function of an insurance company is to provide financial protection against potential future losses. They do this by pooling the premiums of many policyholders together to pay for the losses of a few. This is known as risk pooling.

Regulation

Insurance companies are heavily regulated by government agencies to protect consumers. In the United States, this is done by the National Association of Insurance Commissioners (NAIC) and state insurance departments.

Related Terms

Underwriting: The process by which an insurance company determines the risk of insuring a potential policyholder.
Claim: A formal request by a policyholder to an insurance company for coverage or compensation for a covered loss or policy event.
Actuary: A business professional who deals with the financial impact of risk and uncertainty.

External links

Medical encyclopedia article on Insurance company
Wikipedia's article - Insurance company

This WikiMD article is a stub. You can help make it a full article.

Languages: - East Asian 中文, 日本, 한국어, South Asian हिन्दी, Urdu, বাংলা, తెలుగు, தமிழ், ಕನ್ನಡ,
Southeast Asian Indonesian, Vietnamese, Thai, မြန်မာဘာသာ, European español, Deutsch, français, русский, português do Brasil, Italian, polski

Insurance company