Definition for : Insurance

Insurance, one of the Financial risk management forms, allows companies to pay a Premium to a third party, which assumes the Risk if that Risk materialises. If it does not, companies can benefit from a favourable trend in the parameter covered (exchange rate, Interest rates, Solvency of a debtor, etc.). Conceptually, insurance is based on the technique of options; th

(See Chapter 49 Managing working capital of the Vernimmen)

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