What is referred to as the amount paid to secure an insurance policy?

The amount paid to secure an insurance policy is referred to as the premium. This is essentially the cost of obtaining and maintaining coverage for a specified period. Policyholders pay premiums to the insurance company to keep their insurance active and to receive the benefits and protections outlined in the policy. The premium is determined based on various factors, including the type of coverage, the amount of coverage, the insured’s risk profile, and market conditions.

In contrast, the other terms relate to different aspects of insurance policies. A deductible is the amount the policyholder must pay out of pocket before the insurance company starts to pay a claim. A co-payment, often seen in health insurance, is a fixed amount the insured pays for a specific service or prescription, while the insurance covers the rest. Excess generally refers to an amount of money that is to be paid by the policyholder in the event of a claim, similar to a deductible but often applied differently based on the policy terms. Each of these terms highlights distinct roles within the context of insurance but does not represent the cost of securing the policy itself, which is the premium.