This chapter presents examples of risk exposures that require insurance coverage and discusses the benefits of purchasing insurance products, as well as the characteristics of insurable risks. It further examines systemic and systematic risks and outlines appropriate risk-mitigation strategies for each. Essential insurance terminologies are introduced, accompanied by the information asymmetries that complicate insurance transactions for market participants. The chapter also identifies the implied conditions that must be satisfied before any insurance contract commences. These conditions are considered alongside additional benefits of insurance and a comparison between valued and indemnity contracts. The chapter concludes by discussing techniques for reducing fraudulent activity in the insurance market and the internal risk-management practices that insurance companies can adopt to mitigate fraud.