What is the fee that a policyholder pays when an insurance company agrees to take on the risk?

Understand the Problem

The question is asking for the term used to describe the fee that a policyholder pays to an insurance company for taking on the risk associated with the policy. It is related to insurance terminology.

More Information

An insurance premium is the amount paid for an insurance policy, representing the cost of obtaining coverage for specified risks.

Tips

A common mistake is confusing 'premium' with 'coverage,' which is the protection provided, not the fee paid.

Sources

• Understanding Insurance Premiums - brainly.com
• Insurance Premium Defined - investopedia.com
• Insurance premium: What is it and how does it work? - insurancebusinessmag.com