Insurance is a form of risk management that involves providing financial protection to individuals, businesses, or other organizations against potential losses from unforeseen events. It is a contract between the policyholder and insurer, wherein the insured person or entity agrees to make regular payments to the insurer and, in exchange, the insurer agrees to provide compensation in the event of an event or incident that results in financial losses. Insurance can be used to cover losses from a variety of risks, such as medical expenses, property damage, and even death.