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Question
What is insurance premium?
Long Answer
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Solution
An insurance premium is the amount of money that an individual or entity pays periodically to an insurance company in exchange for coverage against potential financial loss. When a person purchases insurance, they receive a legal contract called an insurance policy, which transfers the risk of potential financial loss from the insured to the insurer. The premium is the monetary compensation paid by the insured to the insurer to secure this financial protection or reimbursement against losses as specified in the insurance policy.
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