ABSTRACT
Insurance is a contract (policy) according to which one party (a policyholder) pays an amount of money (premium) to another party (insurer) in return for an obligation to compensate some possible losses of the policyholder. The aim of such a contract is to provide the policyholder with some protection against certain risks. Death, sickness, disability, motor vehicle accident, loss of property, and so forth are some typical examples of such risks. Each policy contract specifies the policy term and the method of compensation. Usually compensation is provided in the form of payment of an amount of money. Any event specified in the policy contract that takes place during its term can result in such an insurance claim. If none of the events specified in the policy contract happen during the policy term, then the policyholder has no monetary compensation for paid premiums.
