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Explain each of the following: Insurance premium The sum of money paid annually or in instalments to the insurance company in order to be insured - Leaving Cert Home Economics - Question 10 - 2017
Question 10
Explain each of the following: Insurance premium The sum of money paid annually or in instalments to the insurance company in order to be insured. Insurance polic... show full transcript
Worked Solution & Example Answer:Explain each of the following: Insurance premium The sum of money paid annually or in instalments to the insurance company in order to be insured - Leaving Cert Home Economics - Question 10 - 2017
Step 1
Insurance premium
Answer
The insurance premium is the amount of money that an individual or entity pays to an insurance company to obtain coverage. This payment can be made annually or in installments and is required to keep the insurance policy active. The premium is determined based on several factors, including the level of coverage, the insured risk, and an individual's claims history.
Step 2
Insurance policy
Answer
An insurance policy is a formal contract between the insurer and the insured, outlining the specific terms and conditions of coverage. It includes details such as the types of risks covered, the limits of the coverage, deductibles, and the responsibilities of both parties. The policy serves as a legal document that protects the insured by specifying the conditions under which claims can be made.