Decentralized insurance is a system where insurance services operate without central authorities or traditional intermediaries. Instead, these services are built on blockchain technology, allowing users to interact directly with one another.In this model, participants contribute funds to a pool that is used to cover claims. Smart contracts automate the process, ensuring that payouts are executed transparently and fairly based on predefined criteria. This minimizes the need for trust in a central entity.One major advantage is reduced costs. By eliminating middlemen, savings can be passed on to the users. Additionally, decentralized insurance can provide coverage for niche markets that traditional insurers may overlook due to risk or low demand.The approach also emphasizes user control and privacy. Participants maintain ownership of their data and can choose how to participate in the insurance ecosystem. Overall, decentralized insurance seeks to create a more equitable and efficient system for managing risk together.