The social and economic value of insurance

This paper seeks first and foremost to provide a more detailed understanding of the role, benefits and capabilities of the insurance industry, as well as an overview of the functioning of the insurance mechanism. It expounds upon the very real value that insurance offers individuals, institutions and the economy by providing a sense of security and peace of mind, encouraging loss mitigation, increasing prosperity, and generally making people more aware of the reality of risks and their consequences through information and pricing signals. It also addresses some of the misunderstandings about insurance coverage, in particular those areas where they have led to disappointment or disillusionment about the industry.