Overview of Insurance Concepts

What is the basic agreement in an insurance contract called?

What does the insured party agree to pay to the insurer?

What financial benefit does the insured party receive from the insurer?

In the context of insurance, what is considered a loss?

Who is referred to as the insurer in an insurance agreement?

Overview of Insurance

Insurance is an agreement between the insured party (proposer) and the insurance provider (insurer).
This agreement is formalized through an insurance policy, which outlines the terms and conditions of coverage.

Key Terms

Insured Party (Proposer): The individual or entity seeking protection against potential financial losses.
Insurance Provider (Insurer): The company or organization that offers insurance coverage and agrees to provide compensation for specific losses.
Insurance Policy: A legal document detailing the coverage, rights, and responsibilities of both the insured and the insurer.
Insurance Premium: The amount the insured party pays periodically to maintain the insurance policy and coverage.
Compensation: The financial reimbursement provided by the insurer to cover losses sustained by the insured party.
Loss: Refers to the specific financial damage or risk event that triggers the insurance coverage and potential compensation.

This quiz covers the fundamental concepts of insurance, including key terms and the relationship between the insured party and the insurance provider. It explores essential components like insurance policies, premiums, and compensation for losses. Test your understanding of insurance agreements and terminology.