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. An insurer
is a company selling the insurance. The insurance
rate is a factor used to determine the amount, called the premium, to be charged for a certain
amount of insurance coverage. Risk management, the practice of appraising and
controlling risk, has evolved as a discrete field of study and practice.