INSURANCE SERVICES
Insurance is another important subsector of the financial services industry. Insurance services are available for protection against death or injury (e.g., life insurance, disability income insurance, health insurance), against property loss or damage (e.g., homeowners’ insurance, car insurance), or against liability or lawsuit.
In the United States, an insurance agent differs from a broker. The former is a representative of the insurance carrier, while the latter represents the insured and shops around for insurance policies. This is also the realm of the underwriter, who assesses the risk of insuring clients and also advises investment bankers on loan risk. Reinsurers are in the business of selling insurance to the insurers themselves to help protect them from catastrophic losses.
Insurance is a contract, represented by a policy, in which an individual or entity receives financial protection or reimbursement against losses from an insurance company. The company pools clients' risks to make payments more affordable for the insured.
Insurance policies are used to hedge against the risk of financial losses, both big and small, that may result from damage to the insured or her property, or from liability for damage or injury caused to a third party.