Insurance Premium

Quick Summary of Insurance Premium

The periodic payment made on an insurance policy. also called premium.

An insurance premium is simply an amount of money paid for insurance coverage.

An insurance premium is an intrinsic part of a contract between a policyholder and an insurance company. Thus, as long as the policyholder continues to make insurance premium payments, the insurer must guarantee adequate protection. Insurance premiums may vary depending on the policy purchased. For instance, prospective insurance buyers may choose level-premium insurance for its flat insurance premium throughout the duration of the plan. Adjustable life insurance, on the other hand, offers policy owners flexible insurance premium plans. Depending on the type of insurance purchased, there may be a number of other factors affecting the insurance premium. Hence, for example, life insurance premium payments are also dependent on the individual’s age, health, and lifestyle. By the same token, insurance premium costs of policies that indemnify property may be determined by market value and condition.

Examples of Insurance Premium in a sentence

They had to pay their insurance premium and everything was going very good and things were looking great for everyone.

The insurance premium related to the Group Health Insurance plan sponsored by the company has increased markedly in recent years.

Since the insurance premium paid must be high enough to cover the insurer’s costs plus profit, it’s generally a bit higher than the average case of bearing the insured risk oneself; however, insurance is about the unlucky cases, not the average case.

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