Insurance is all about preparing for risk, this could be the risk of theft, or against the costs involved in a car accident or health crisis. The basic idea is that you make a regular payment to an insurance provider to cover you in the case of a specific eventuality and if that occurs, the insurance company will cover the cost. Essentially, you are paying a smaller amount now so that if the worst happens, you will be able to recover from it. It’s a way for individuals and organisations to cover themselves against costs that would otherwise be crippling.

Insurance companies can provide this service by calculating the probability of the event occurring and pricing the insurance accordingly. This means taking advantage of the law of large numbers, many people purchase house insurance but not every house is damaged or stolen from. So, by each person paying an amount to cover the risk, those who do need to cover damage can claim the amount required from insurance companies.

This creates several career paths within insurance, examples include underwriters who evaluate the risk facing a client and price policies appropriately, claims handlers who step in when a client wishes to make a claim on a policy, insurance assessors and loss adjusters will investigate how much the claim is worth and actuaries are highly trained professionals who are experts at assessing risk. The career paths in insurance are explored in greater detail in the remaining sections.