When people buy insurance for the first time, two terms often cause confusion: premium and deductible. Both are important parts of many insurance policies, and both can affect how much money a policyholder spends. However, they are not the same thing and they serve very different purposes.<\/p>\n\n\n\n
A premium is the amount a policyholder pays to an insurance company to maintain insurance coverage. A deductible, on the other hand, is an amount the policyholder may have to pay toward a covered loss before the insurer pays the remaining eligible amount, depending on the terms of the policy.<\/p>\n\n\n\n
Understanding the difference between these two costs is important because choosing an insurance policy is not simply about finding the lowest monthly or yearly price. A policy with a lower premium may have a higher deductible, while a policy with a higher premium may have a lower deductible. The right choice depends on the person’s financial situation, the type of insurance, the level of risk involved, and the terms of the particular policy.<\/p>\n\n\n\n
What Is an Insurance Premium?<\/strong><\/p>\n\n\n\n An insurance premium is the amount charged by an insurance company for providing insurance coverage under a policy.In simple terms, the premium is the price a policyholder pays to have insurance protection. Depending on the type of insurance and the payment arrangement, a premium may be paid monthly, quarterly, annually, or according to another schedule.<\/p>\n\n\n\n For example, suppose a person purchases an auto insurance policy that costs $1,200 per year. If the insurer allows monthly payments without changing the total cost, the policyholder might pay approximately $100 per month. The $1,200 is the annual premium, while the monthly amount represents the payment schedule.The premium is generally required whether or not the policyholder makes a claim during the policy period. This is because the premium pays for the insurance protection itself, not only for situations in which a claim is filed.<\/p>\n\n\n\n A person could pay premiums for an entire year and never make a claim. That does not mean the premium was wasted. During that period, the person had the financial protection provided by the policy if a covered event had occurred.<\/p>\n\n\n\n Why Do Insurance Companies Charge Premiums?<\/strong><\/p>\n\n\n\n Insurance companies need financial resources to operate their businesses and pay covered claims. Insurance is based in part on the idea of pooling risk.An insurer may have a large number of policyholders who each pay premiums. Not every policyholder will experience a covered loss during the same period. The premiums collected across the pool help support the insurer’s ability to pay covered claims and operate the insurance business.<\/p>\n\n\n\n For example, imagine that thousands of people have auto insurance with the same insurer. Each policyholder pays a premium, but only some policyholders may experience covered accidents during a particular year. The insurer uses its financial resources to handle eligible claims according to the policies.<\/p>\n\n\n\n This does not mean that an individual’s premium is placed into a personal account waiting for that person’s claim. Insurance operates through a broader system of risk pooling and financial management.<\/p>\n\n\n\n What Determines the Amount of an Insurance Premium?<\/strong><\/p>\n\n\n\n Insurance premiums are not usually the same for everyone. The amount can vary based on the type of insurance, the insurer, the level of risk, the amount of protection requested, the location, and other factors relevant to the particular policy.<\/p>\n\n\n\n For auto insurance, an insurer may consider factors such as the vehicle, driving history, location, and other information used to assess risk.For homeowners insurance, factors may include the property, its location, construction characteristics, coverage amount, and other risk-related information.For life insurance, factors can include age, the type and amount of coverage, and other information used by the insurer to evaluate the applicant’s risk.The exact factors and their importance vary between insurance products, insurers, and jurisdictions.<\/p>\n\n\n\n This is why two people purchasing similar insurance may receive different premiums. Their individual circumstances may create different levels of expected risk.<\/p>\n\n\n\n What Is an Insurance Deductible?<\/strong><\/p>\n\n\n\n A deductible is an amount that the policyholder may be responsible for paying toward a covered loss before the insurer pays the remaining eligible amount, subject to the policy’s terms.<\/p>\n\n\n\n For example, suppose a covered loss results in $5,000 of eligible damage and the policy has a $1,000 deductible. If the deductible applies to that loss, the policyholder may be responsible for the first $1,000, while the insurer may pay the remaining $4,000, assuming there are no other limitations or adjustments.<\/p>\n\n\n\n This is a simplified example. Real insurance claims can involve policy limits, exclusions, valuation methods, multiple coverages, and other conditions that can affect the final payment.The important idea is that a deductible represents a portion of a covered loss that the policyholder may have to pay themselves.<\/p>\n\n\n\n Premium vs. Deductible: The Basic Difference<\/p>\n\n\n\n The easiest way to remember the difference is this:<\/p>\n\n\n\n Premium = what you pay for insurance coverage.<\/p>\n\n\n\n Deductible = what you may pay toward a covered loss before insurance pays the remaining eligible amount.<\/p>\n\n\n\n A premium is generally paid to maintain the insurance policy, whether or not a claim occurs.<\/p>\n\n\n\n A deductible generally becomes relevant when a covered loss occurs and the particular coverage has an applicable deductible.<\/p>\n\n\n\n For example, a person may pay a $150 monthly premium for auto insurance. Months later, they experience a covered accident that causes $4,000 of eligible damage. If the applicable deductible is $1,000, the policyholder may have to pay $1,000 toward the covered damage and the insurer may pay the remaining eligible $3,000.<\/p>\n\n\n\n The $150 monthly premium and the $1,000 deductible are therefore two completely different financial obligations.<\/p>\n\n\n\n A Simple Example<\/em><\/strong><\/p>\n\n\n\n Consider a fictional home insurance policy.Suppose the policyholder pays a premium of $1,500 per year. The policy also has a $1,000 deductible for a particular covered loss.During the policy period, a covered event causes $8,000 of eligible damage.<\/p>\n\n\n\n If the $1,000 deductible applies, the simplified calculation would be:<\/p>\n\n\n\n Eligible loss: $8,000<\/p>\n\n\n\n Deductible: $1,000<\/p>\n\n\n\n Potential insurance payment: $7,000<\/p>\n\n\n\n The policyholder has already paid the annual premium to maintain the insurance coverage. The deductible is an additional amount connected with the covered loss.<\/p>\n\n\n\n This example demonstrates why it is important not to confuse the premium with the deductible. They are paid for different reasons and at different stages.<\/p>\n\n\n\n Do You Pay the Deductible Every Month?<\/strong><\/p>\n\n\n\n Generally, no.<\/p>\n\n\n\n A deductible is not normally a monthly payment like a premium. It generally becomes relevant when a covered claim occurs and the applicable policy coverage requires a deductible.<\/p>\n\n\n\n For example, if a person has a $1,000 deductible and does not experience a covered loss during the policy year, they would not normally pay $1,000 simply because the deductible exists.They continue paying the required premium to maintain the policy.If a covered loss occurs, the deductible may then be applied according to the policy terms.<\/p>\n\n\n\n However, the exact operation of deductibles can vary by insurance type and policy. Some policies can have different deductibles for different types of losses or circumstances.<\/p>\n\n\n\n Why Can a Higher Deductible Result in a Lower Premium?<\/strong><\/p>\n\n\n\n One reason people may choose a higher deductible is that it can sometimes be associated with a lower premium.The basic idea is that when the policyholder agrees to take on more of the financial responsibility for a covered loss, the insurer may have less expected claim exposure for certain losses. Depending on the insurance product and insurer, this can affect the premium.<\/p>\n\n\n\n For example, imagine two otherwise comparable policies:<\/p>\n\n\n\n Policy A: $500 deductible and $1,500 annual premium.<\/p>\n\n\n\n Policy B: $1,500 deductible and $1,250 annual premium.<\/p>\n\n\n\n Policy B has a lower premium, but the policyholder may have to pay more out of pocket if a covered claim occurs.<\/p>\n\n\n\n The difference is important because saving $250 in annual premium may not be worthwhile for someone who would struggle to pay the larger deductible after a loss.<\/p>\n\n\n\n A deductible should therefore be considered together with the premium rather than separately.<\/p>\n\n\n\n Why Can a Lower Deductible Result in a Higher Premium?<\/strong><\/p>\n\n\n\n The opposite can also occur. A lower deductible may be associated with a higher premium because the insurer may be taking on more of the covered loss when a claim occurs.<\/p>\n\n\n\n For example, consider two simplified options:<\/p>\n\n\n\n Option A: $500 deductible with a $1,500 annual premium.<\/p>\n\n\n\n Option B: $2,000 deductible with a $1,200 annual premium.<\/p>\n\n\n\n The first option costs more in premium, but the policyholder may have a smaller deductible if an applicable covered loss occurs.<\/p>\n\n\n\n The second option costs less to maintain, but the policyholder may have a larger financial responsibility when a covered loss occurs.<\/p>\n\n\n\n This creates a trade-off between ongoing cost and potential out-of-pocket cost.<\/p>\n\n\n\n Premium and Deductible Are Not the Only Costs<\/strong><\/p>\n\n\n\n Although premium and deductible are important, they are not necessarily the only financial amounts a policyholder may encounter.Depending on the type of insurance, a policy may involve other out-of-pocket expenses, cost-sharing arrangements, fees, or amounts that are not covered by the policy.<\/p>\n\n\n\n For example, health insurance can involve different forms of cost sharing. Property or auto insurance claims can also involve expenses that are not covered because of exclusions, limits, or other policy provisions.<\/p>\n\n\n\n Therefore, a person should not evaluate an insurance policy only by comparing its premium and deductible. The entire policy should be considered.<\/p>\n\n\n\n Why the Difference Matters<\/strong><\/p>\n\n\n\n Understanding the difference between premium and deductible helps a person make better insurance decisions.<\/p>\n\n\n\n Someone may see a policy advertised with a very low premium and assume that it is automatically the best option. However, the policy may have a high deductible or other limitations that could create significant financial responsibility after a claim.Similarly, a policy with a higher premium is not automatically better. It may provide a lower deductible or broader protection, but the additional cost may not be appropriate for every person.<\/p>\n\n\n\n The goal is not simply to choose the lowest premium or the lowest deductible. The goal is to choose insurance protection that fits the person’s needs and financial ability.<\/p>\n\n\n\n What Happens When There Is No Claim?<\/strong><\/p>\n\n\n\n If the policyholder does not experience a covered loss during the policy period, the deductible generally does not become a payment simply because it exists.The policyholder continues to pay the required premium according to the policy’s payment terms.<\/p>\n\n\n\n For example, someone may pay $1,000 in annual premiums for auto insurance and have a $500 deductible. If they have no covered accident during the year, they generally do not pay the $500 deductible.<\/p>\n\n\n\n The deductible is associated with applicable covered losses rather than being a regular payment for maintaining the policy.<\/p>\n\n\n\n What Happens When There Is a Claim?<\/strong><\/p>\n\n\n\n When a covered loss occurs, the deductible may become relevant.<\/p>\n\n\n\n Suppose a policyholder has a covered loss of $6,000 and the applicable deductible is $1,000. If all $6,000 qualifies as an eligible covered loss and no other policy provisions reduce the payment, the simplified calculation would be:<\/p>\n\n\n\n $6,000 covered loss \u2212 $1,000 deductible = $5,000 insurance payment<\/p>\n\n\n\n The policyholder is responsible for the deductible, while the insurer may pay the remaining eligible amount.<\/p>\n\n\n\n However, this calculation is only an illustration. Actual claims can be more complicated because the final amount may also depend on coverage limits, exclusions, depreciation, valuation rules, and other policy provisions.<\/p>\n\n\n\n Key Difference <\/em><\/strong>:<\/p>\n\n\n\n The simplest distinction is:<\/em><\/p>\n\n\n\n A premium is the price you pay to have insurance coverage, while a deductible is the amount you may have to pay toward a covered loss before the insurer pays the remaining eligible amount.<\/p>\n\n\n\n Understanding this difference is one of the first steps toward understanding the real cost of insurance.<\/p>\n\n\n\n How Premium and Deductible Work Together<\/strong><\/p>\n\n\n\n Premium and deductible are different costs, but they are connected when you evaluate the overall financial cost of an insurance policy.<\/p>\n\n\n\n The premium is the cost of keeping the insurance protection in place. The deductible affects how much of a covered loss the policyholder may have to pay themselves when a claim occurs.This creates an important trade-off. A person may choose a policy with a lower premium and accept a higher deductible, or choose a policy with a higher premium and a lower deductible.<\/p>\n\n\n\n Neither option is automatically better for everyone. The appropriate choice depends on how much the person can comfortably pay on a regular basis and how much they could afford to pay unexpectedly after a covered loss.<\/p>\n\n\n\n For example, suppose two otherwise similar policies are available. One costs $1,200 per year with a $2,000 deductible. The other costs $1,500 per year with a $500 deductible.The second policy costs $300 more each year, but its deductible is $1,500 lower. If a significant covered loss occurs, the second policy could require substantially less out-of-pocket payment for the deductible.On the other hand, if no applicable claim occurs, the policyholder pays the higher premium without needing to pay the deductible.<\/p>\n\n\n\n This is why the decision should be based on the person’s financial circumstances and risk tolerance rather than looking at only one number.<\/p>\n\n\n\n Lower Premium vs. Higher Deductible<\/strong><\/p>\n\n\n\n A policy with a higher deductible can sometimes have a lower premium. This may appeal to someone who wants to reduce their regular insurance expenses.However, the policyholder should ask an important question before selecting this arrangement:<\/p>\n\n\n\n \u201cIf I have a covered loss tomorrow, could I comfortably afford the deductible?\u201d<\/p>\n\n\n\n Suppose someone chooses a $2,500 deductible because it reduces the annual premium. If they later experience a covered loss and do not have enough savings to pay the $2,500, the lower premium may have created a financial problem at exactly the time when they needed their insurance.<\/p>\n\n\n\n A higher deductible can therefore make sense for someone who has enough accessible savings to handle that potential expense.<\/p>\n\n\n\n It may be less suitable for someone whose budget is already tight and who would struggle to pay a large unexpected bill.<\/p>\n\n\n\n Higher Premium vs. Lower Deductible<\/strong><\/p>\n\n\n\n A lower deductible can sometimes be paired with a higher premium.<\/p>\n\n\n\n This arrangement may appeal to people who prefer more predictable financial responsibilities when a covered loss occurs.<\/p>\n\n\n\n For example, someone might prefer paying a somewhat higher premium throughout the year rather than facing a very large deductible after a claim.<\/p>\n\n\n\n Consider two simplified policies:<\/strong><\/em><\/p>\n\n\n\n Policy A: $1,000 annual premium with a $2,000 deductible.<\/p>\n\n\n\n Policy B: $1,300 annual premium with a $500 deductible.<\/p>\n\n\n\n Policy B costs $300 more per year, but the deductible is $1,500 lower.<\/p>\n\n\n\n If a covered claim occurs and the deductible applies, the policyholder may prefer the second arrangement because the immediate out-of-pocket responsibility is smaller.<\/p>\n\n\n\n Again, the actual value depends on the policy, the person’s finances, and how likely a covered loss may be.<\/p>\n\n\n\n How to Decide Which Deductible Is Appropriate<\/strong><\/p>\n\n\n\n There is no single deductible that is correct for everyone.<\/p>\n\n\n\n A useful starting point is to consider the amount of money you could realistically pay after an unexpected covered loss without causing serious financial difficulty.<\/p>\n\n\n\n For example, if a $500 deductible would be manageable but a $2,500 deductible would require borrowing money or using essential savings, the lower deductible may be more appropriate even if its premium is higher.On the other hand, someone with sufficient emergency savings may be comfortable accepting a higher deductible in exchange for a lower premium.<\/p>\n\n\n\n The decision should also consider how frequently a person expects to make claims, although no one can predict future losses with certainty.<\/p>\n\n\n\n The goal is to find a balance between the regular premium and the potential out-of-pocket responsibility.<\/p>\n\n\n\n An Example Using Annual Cost<\/em><\/strong><\/p>\n\n\n\n Suppose a person is comparing two hypothetical auto insurance policies.<\/p>\n\n\n\n Policy A costs $1,400 per year and has a $500 deductible.<\/p>\n\n\n\n Policy B costs $1,100 per year and has a $1,500 deductible.<\/p>\n\n\n\n Policy B saves the policyholder $300 in annual premium.<\/p>\n\n\n\n However, if an applicable covered loss occurs, Policy B could require the policyholder to pay $1,000 more toward the deductible than Policy A.This does not mean Policy A is automatically better. If the policyholder never has an applicable claim, the lower premium of Policy B may save money.But if a covered claim occurs, the higher deductible could create a larger immediate financial burden.<\/p>\n\n\n\n This illustrates why insurance decisions should be based on both expected ongoing cost and potential unexpected cost.<\/p>\n\n\n\n What If the Claim Is Smaller Than the Deductible?<\/strong><\/p>\n\n\n\n A deductible can also affect whether a policyholder receives an insurance payment for a particular loss.<\/p>\n\n\n\n Suppose a policy has a $1,000 deductible and a covered loss results in only $700 of eligible damage.<\/p>\n\n\n\n If the deductible applies to that loss, the amount of the loss is below the deductible. In a simplified situation, the insurer would not make a payment because the policyholder’s deductible exceeds the eligible loss.<\/p>\n\n\n\n This is one reason people should understand their deductible before deciding whether to file a claim.<\/p>\n\n\n\n However, whether a particular loss should be reported and how a claim is handled depends on the type of insurance and the policy’s requirements. A policyholder should not assume that every small loss should simply be ignored.<\/p>\n\n\n\n What If the Loss Is Much Larger Than the Deductible?<\/strong><\/p>\n\n\n\n Now consider the opposite situation.<\/p>\n\n\n\n Suppose the applicable deductible is $1,000 and the covered loss is $10,000.<\/p>\n\n\n\n If the entire $10,000 is eligible under the policy and there are no other applicable limitations, the simplified calculation would be:<\/p>\n\n\n\n $10,000 covered loss \u2212 $1,000 deductible = $9,000 potential insurance payment<\/p>\n\n\n\n The deductible therefore represents only one part of the claim calculation.<\/p>\n\n\n\n Other factors may affect the final payment, including policy limits, exclusions, valuation rules, and the specific coverage involved.<\/p>\n\n\n\n This is why a deductible should never be considered separately from the rest of the policy.<\/p>\n\n\n\n Does a Higher Deductible Always Mean a Lower Premium?<\/strong><\/p>\n\n\n\n Not necessarily in every situation.<\/p>\n\n\n\n A higher deductible can be associated with a lower premium for certain insurance products because it changes the amount of financial responsibility the policyholder accepts for covered losses. However, insurance pricing depends on many factors.The premium can also be affected by the type of insurance, the amount of coverage, the insured risk, location, claims history, insurer pricing practices, and other relevant factors.Therefore, a person should not assume that simply increasing the deductible will always produce a particular amount of savings.<\/p>\n\n\n\n The actual premium should be obtained from the insurer for the specific policy being considered.<\/p>\n\n\n\n Does a Lower Premium Mean Less Coverage?<\/strong><\/p>\n\n\n\n Not automatically.<\/p>\n\n\n\n A lower premium can result from several different factors. It could be associated with a higher deductible, lower coverage limits, different coverage options, a different risk profile, or other policy characteristics.For this reason, comparing only the premium can produce a misleading result.<\/p>\n\n\n\n For example, Policy A may cost $1,000 per year and Policy B may cost $1,300. If Policy B provides significantly different protection, the additional $300 cannot be evaluated without looking at the actual policy terms.<\/p>\n\n\n\n Price should therefore be considered alongside coverage and other important policy provisions.Premium, Deductible, and the Total Financial PictureWhen evaluating insurance, it is useful to think about three broad financial questions.<\/p>\n\n\n\n First, how much will I pay to maintain the policy?<\/em><\/strong><\/p>\n\n\n\n This is primarily related to the premium.<\/p>\n\n\n\n Second, how much might I have to pay myself if a covered loss occurs?<\/em><\/strong><\/p>\n\n\n\n This can include the applicable deductible and other costs that the policy does not cover.<\/p>\n\n\n\n Third, how much protection could the policy provide for a qualifying loss?<\/em><\/strong><\/p>\n\n\n\n This depends on the policy’s coverage, limits, conditions, and other provisions.<\/p>\n\n\n\n Looking at all three questions gives a more realistic picture than simply asking which policy has the lowest premium.<\/p>\n\n\n\n Why Emergency Savings Matter When Choosing a Deductible<\/strong><\/p>\n\n\n\n A person’s emergency savings can be relevant when choosing an insurance deductible.Suppose someone has enough accessible savings to cover a $2,000 deductible without affecting rent, food, utilities, or other essential expenses. They may be more comfortable selecting a policy with that deductible.<\/p>\n\n\n\n Another person may have very limited savings. For them, a $2,000 unexpected expense could be extremely difficult to manage. A lower deductible may therefore be worth considering even if it comes with a higher premium.This does not mean that everyone should choose a low deductible. It simply demonstrates why the appropriate choice depends partly on personal financial circumstances.<\/p>\n\n\n\n Insurance should fit into an overall financial plan rather than being considered in isolation.<\/p>\n\n\n\n Can Deductibles Differ Within the Same Policy?<\/strong><\/p>\n\n\n\n Yes. Some insurance policies can have different deductibles for different coverages or types of losses.<\/p>\n\n\n\n For example, a policy may have one deductible for one category of loss and a different deductible for another category. Certain policies may also have special deductibles associated with particular events or circumstances.This means that seeing one deductible amount on a policy does not always mean that the same amount applies to every possible claim.<\/p>\n\n\n\n Policyholders should check the relevant coverage and claim circumstances before assuming which deductible will apply.<\/p>\n\n\n\n Why You Should Read the Policy Before Choosing Insurance<\/strong><\/p>\n\n\n\n The relationship between premium and deductible is only one part of the insurance decision.A policyholder should also understand the protection being purchased, the applicable limits, exclusions, conditions, and other important provisions.<\/p>\n\n\n\n For example, a policy may have an attractive premium and deductible but provide less protection than the policyholder actually needs.<\/p>\n\n\n\n Another policy may cost more but provide protection that is more suitable for the person’s circumstances.Reading the policy or asking the insurer specific questions can help prevent misunderstandings.<\/p>\n\n\n\n Common Mistakes When Comparing Premiums and Deductibles<\/strong><\/p>\n\n\n\n One common mistake is choosing the policy with the lowest premium without checking the deductible. A lower premium can look attractive, but a high deductible may create a significant financial responsibility after a covered loss.<\/p>\n\n\n\n Another mistake is choosing the lowest possible deductible without considering whether the additional premium is affordable or worthwhile.Some people also assume that paying a deductible guarantees that the insurer will pay the rest of the loss. That is not necessarily true. The loss must still qualify for coverage, and policy limits, exclusions, conditions, and other provisions may affect the payment.<\/p>\n\n\n\n Another mistake is assuming that the deductible is the only out-of-pocket cost. Depending on the insurance type, some losses or expenses may not be covered by the policy.<\/p>\n\n\n\n A Practical Way to Compare Two Policies<\/strong>:<\/p>\n\n\n\n When comparing two insurance policies, start by writing down the annual or monthly premium for each policy.Then compare the applicable deductibles.After that, look at the actual coverage provided by each policy. Check whether the limits are appropriate, whether important exclusions apply, and whether the policies have different conditions or benefits.<\/p>\n\n\n\n Finally, consider your own finances.<\/p>\n\n\n\n Ask yourself whether you could comfortably afford the deductible if a covered loss occurred. Also consider whether the premium is affordable over the entire policy period.This approach gives you a much more complete comparison than choosing whichever policy has the lowest advertised price.<\/p>\n\n\n\n <\/p>\n\n\n\n The Most Important Difference<\/em><\/strong><\/p>\n\n\n\n The premium and deductible represent two different sides of insurance costs.<\/p>\n\n\n\n The premium is the ongoing price of maintaining insurance protection.<\/p>\n\n\n\n The deductible is the portion of an applicable covered loss that the policyholder may have to pay before the insurer pays the remaining eligible amount.<\/p>\n\n\n\n A person should therefore consider both when evaluating an insurance policy.<\/p>\n\n\n\n Choosing a policy is not simply a decision between \u201ccheap\u201d and \u201cexpensive.\u201d It is a decision about how much to pay regularly, how much financial responsibility to accept if a covered loss occurs, and whether the overall protection fits the person’s needs.<\/p>\n\n\n\n Key Takeaway<\/strong>:<\/p>\n\n\n\n Premium and deductible are two of the most important financial concepts to understand when buying insurance, but they should not be confused.<\/p>\n\n\n\n The premium is paid for the insurance protection itself and is generally required according to the policy’s payment terms. The deductible generally becomes relevant when an applicable covered loss occurs.A higher deductible may sometimes be associated with a lower premium, while a lower deductible may sometimes come with a higher premium. The best choice depends on the policy, the type of risk, and the policyholder’s ability to handle unexpected expenses.<\/p>\n\n\n\n Before choosing insurance, compare the premium and deductible together with the actual coverage, limits, exclusions, and conditions. A policy that looks inexpensive at first may not necessarily provide the protection or financial arrangement that best fits your circumstances.<\/p>\n\n\n\n Sources:<\/strong><\/p>\n\n\n\n National Association of Insurance Commissioners (NAIC), \u201cGlossary of Insurance Terms.\u201d
https:\/\/content.naic.org\/glossary-insurance-terms<\/a><\/p>\n\n\n\n