In the context of insurance, what is an insurer?

• A. A person receiving coverage
• B. The entity providing coverage
• C. A claims adjuster
• D. A regulatory authority

Answer: (B)

In the context of insurance, an insurer is the entity that provides coverage, meaning it assumes the risk associated with the insurance policies it sells. This can include various types of insurance such as health, property, casualty, and life insurance. The primary function of the insurer is to offer financial protection to policyholders in exchange for premiums, which helps mitigate the financial impact of risks like accidents, damages, or losses.

Understanding this definition clarifies the roles of the other options. The person receiving coverage is referred to as the policyholder or insured, while a claims adjuster is an individual who evaluates claims made by the insured to determine the insurer's liability. A regulatory authority oversees the insurance companies and ensures compliance with laws and regulations, but does not participate in providing coverage itself. Thus, the definition of an insurer as the entity providing coverage is essential in understanding the dynamics of the insurance industry.