Insurance is a contract between an individual or entity and an insurance company that provides financial protection against potential losses or damages. The individual or entity pays a premium in exchange for the insurance company's promise to cover losses or damages, such as accidents, illnesses, property damage, or death. There are various types of insurance policies available, including life insurance, health insurance, auto insurance, home insurance, and liability insurance. Insurance is an important tool for managing risk and protecting oneself financially in the face of unexpected events.