USBA

Insurance is a form of risk management primarily used to hedge against the risk of a contingent loss. The process of insuring something or someone presupposes the involvement of two parties ?The insurer and the insured. An insurer is a company selling the insurance to a person, who is the insured. The insurance rate is a factor which determines the amount, the premium, to be charged for a certain amount of insurance coverage. The event that gives rise to the loss that is subject to insurance should, at least in principle, take place at a known time, in a known place, and from a known cause. The best example is death of an insured on a life insurance policy. Fire, or automobile accidents, as well as worker injuries may all easily meet this criterion. A large number of insurance policies are provided for individual members of very large classes. Automobile insurance, for instance, covers about 175 million automobiles in the United States.