insurance fund

An insurance fund is a pool of money collected by an insurance company from policyholders through premiums. This fund is used to pay out claims when insured events occur, such as accidents or disasters. The idea is that many people contribute to the fund, but only a few will need to make claims at any given time. This shared risk helps ensure that individuals can receive financial support when facing unforeseen circumstances, while enabling the insurance company to manage its resources and remain solvent.