The basic reason why individuals want insurance is that they are assumed to be risk-averse and assumed to want to remove

[answerhappygod]

The basic reason why individuals want insurance is that they are
assumed to be risk-averse and assumed to want to
remove the information-theoretic problem of moral hazard.
maximize the utility of the expected monetary outcome in an
uncertain world.
overcome the information asymmetries that are barriers to an
insurance transaction.
minimize the amount of adverse selection.
maximize their "expected utility" in the statistical sense of
the phrase.