Question: Do traders, insttitutions and hedge funds, use i surance policies for trades that they make?

As the title says. Was talking witb a colleague aboutlarge trades by institutions, hedge funds and the like. Colleague sugested that they would take out insurance policies against a trade in case it went south. I argued that the only “insurance” was a hedge trade of some sort.
Is there such a thing as an insurance policy for a trade?