Understanding the Core Purpose of Insurance

Explore the fundamental purpose of insurance, which is to transfer risk. Discover how this principle protects individuals and businesses from unexpected financial burdens and the various ways insurance plays a critical role in risk management.

The world of insurance can seem a bit perplexing, can’t it? With terms flying around like “risk,” “premiums,” and “coverage,” it’s easy to lose sight of what really matters. So, what’s the primary purpose of insurance? Spoiler alert: it’s not about immediate financial gain or making tax forms easier to navigate. Let’s unpack this together!

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