Insurance is a contract between an individual or a business (the policyholder) and an insurance company. In exchange for regular premium payments, the insurance company agrees to provide financial protection against specified risks or losses. Insurance policies cover a wide range of areas, including life, health, property, liability, and more. The purpose of insurance is to transfer the risk of potential losses from the policyholder to the insurer, offering peace of mind and financial security in case of unexpected events or circumstances.