A loss is defined as a reduction in value to your property or financial assets that is caused by an unexpected, unintended, or overlooked event.

The Store of Intrinsic Value is protected from loss by transferring this negative risk on to an insurance company.  The intrinsic value of the insurance you purchase is exactly equal to the numerical value lost if something were to happen without this protection in place.

You should aim to be very efficient and complete with this aspect of your own Steady State Principle.  Insurance is a gigantic umbrella that will protect all three pieces of your financial model.

                                                                                                                                                                                         ⇰ Reserve