Insurance is a contractual agreement under which the insured party promises to pay the insurer a periodic amount in exchange for a payout in the event of a future loss. If such a loss occurs, the insured party may be required to retain a portion of the loss (known as a deductible), while the insurer pays the remaining amount. Insurance is used as a risk mitigation tactic by individuals and businesses. Certain types of insurance are required, depending on the laws of the governing jurisdiction.

There are many types of insurance, including the following:

  • Automobile insurance
  • Business interruption insurance
  • Crop insurance
  • Disability insurance
  • Errors and omissions insurance
  • Liability insurance
  • Life insurance
  • Medical insurance
  • Product liability insurance
  • Professional liability insurance
  • Property insurance
  • Workers' compensation insurance

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Business Insurance Fundamentals