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A promise of compensation for particular potential future losses in trade for a periodic fee. Insurance coverage is designed to protect the monetary properly-being of a person, company or other entity within the case of sudden loss Some types of insurance coverage are required by legislation, while others are non-compulsory Agreeing to the terms of an insurance coverage coverage creates a contract between the insured and the insurer In change for payments from the insured (known as premiums ), the insurer agrees to pay the policy holder a sum of money upon the prevalence of a specific event.

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