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How Insurance
Works
Insurance is a method
of protecting individuals from major financial losses by
“pooling” the premiums of a large number of people.
Basically, the premiums of many pay for the losses of the
few. As a result, for a fairly reasonable premium you
can protect yourself against a large loss such as a
house fire or a lawsuit resulting from a car accident.
Without insurance few of us would be able to take on the
high financial risk of operating a vehicle or carrying a
mortgage on a new house.
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