Insurance Policy

Business, Legal & Accounting Glossary

Definition: Insurance Policy


Quick Summary of Insurance Policy


An insurance policy is a contract between an insurer and the insured that requires the insured to pay a premium to the insurer in exchange for a benefit to be paid in the event of a loss.




Full Definition of Insurance Policy


An insurance policy is essentially a contract between the insurer and the insured. The primary purpose of any insurance policy is to reduce financial losses resulted from various accidents or death by redistributing the risk among large numbers of people, also known as risk pooling. Specifically, the insurer agrees to pay the insured a specified amount in the event that the insured sustains a loss, as per the insurance policy agreement. In return, the insured is required to make premium payments in order to maintain the insurance policy. A given insurance policy may also include beneficiaries. An insurance policy is applicable to any form of indemnity, including life, health, casualty, auto, property, and etc. Insurers may offer insurance policy solutions to any individual able to pay, or may contract with companies to offer special rates for group insurance.


Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/insurance-policy/
Modern Language Association (MLA):
Insurance Policy. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. September 22, 2021 https://payrollheaven.com/define/insurance-policy/.
Chicago Manual of Style (CMS):
Insurance Policy. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/insurance-policy/ (accessed: September 22, 2021).
American Psychological Association (APA):
Insurance Policy. PayrollHeaven.com. Retrieved September 22, 2021, from PayrollHeaven.com website: https://payrollheaven.com/define/insurance-policy/

Definition Sources


Definitions for Insurance Policy are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 6th August, 2021 | 10 Views.