An insurance company is a business that provides financial protection to individuals and organizations against potential losses or damages. Customers pay a regular fee, known as a premium, in exchange for coverage. If a covered event occurs, such as an accident or natural disaster, the insurance company compensates the policyholder according to the terms of their agreement. Insurance companies offer various types of coverage, including health insurance, auto insurance, and homeowners insurance. They assess risks and determine premiums based on factors like age, health, and driving history. By pooling resources from many policyholders, insurance companies can manage risks and provide support when needed.