Frequently Asked Questions > What is insurance?

What is insurance?

Posted on January 3, 2023

Insurance is the transfer of risk from a person or business to an insurance company. This is facilitated through the purchase of an insurance policy. The policy is a contract that states the terms and conditions by which the policyholder will receive financial protection from the insurance company in the event of a covered loss.

It is important to note that contracts of insurance are between the consumer and the insurance company only. An insurance broker is not party to the policy.