What is the main goal of insurance?

The primary goal of insurance is to provide financial security against unforeseen risks. This means that insurance is designed to protect individuals and businesses from losses that can occur due to unexpected events, such as accidents, natural disasters, or theft. By paying premiums, policyholders transfer the financial risk of these events to the insurance company, which in turn provides compensation when a covered loss occurs. This arrangement allows individuals and organizations to manage risks more effectively, helping to maintain financial stability in the face of potential adverse events.

The focus on financial security underscores the purpose of insurance as a risk management tool rather than a profit-making venture or a means of assigning blame. It's about safeguarding assets and ensuring that people can recover from losses without facing devastating financialConsequences.