Page 1: Introduction - What is insurance?
Life is full of risks. Insurance can provide security against some of these risks. For example, motor insurance provides cover for certain costs resulting from a road accident or the theft of a car.
A contract of insurance involves the insured making a payment, (a premium) to an insurer. In return for the premium the insurer agrees to provide the insured with cover for certain types of losses arising from specified events. For example, a policy of household insurance might provide cover for damage to a house in the event of a fire.