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insuratization

Insuratization is the process of using an insurance contract as a hedge against certain financial risks.

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insuratization

Insuratization is the process of using an insurance contract as a hedge against certain financial risks.

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Examples of such risks include the cost of raw materials, currency fluctuations, and investment portfolio volatility. At one time, insurance was considered applicable to only pure risk (loss or no loss). Increasingly, insurance is being used to hedge the risk of "no profit" as well.

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