Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for a premium, and can be thought of a guaranteed small loss to prevent a large, possibly devastating large loss.
Is there anything we can not buy insurance for? Anything we shouldn't buy insurance for?
We have homeowners insurance, car insurance, life insurance and medical insurance. We can insure our credit card purchases for (in my opinion) a very steep fee. There's travel insurance, liability, casualty and disability insurance.
Did you know?
If you live in, or operate a business in a High risk location such as Columbia or Peru, you may even obtain Kidnapping and Ransom Insurance?
K&R policies are typically for the purpose of recovering losses due to kidnap, extortion, hijacking and wrongful detention. Really? Why would anyone want to live in a place where this is even available?