Risk sharing

{
  "id": "MLC-T-INS-002989",
  "term": "Risk sharing",
  "field": "Insurance and risk management",
  "definition": "A method of managing risk by distributing the financial burden of potential losses among multiple parties. In insurance, this involves pooling premiums from many policyholders to pay for the claims of the few who suffer a covered event, spreading the impact of any single loss across the group. Formal risk-sharing arrangements include coinsurance, where the policyholder bears a percentage of the loss, and reinsurance, where the insurer transfers part of its risk to another insurer.",
  "url": "https://mlchart.com/terminology/insurance/risk-sharing/"
}