What Is an Insurance Premium?

An insurance premium is the amount of money an individual or business pays for an

insurance policy. Insurance premiums are paid for policies that cover healthcare,
auto, home, and life insurance.

Once earned, the premium is income for the insurance company. It also represents a
liability, as the insurer must provide coverage for claims being made against the
policy. Failure to pay the premium on the part of the individual or the business
may result in the cancel
lation of the policy.
KEY TAKEAWAYS
An insurance premium is the amount of money an individual or business must pay for
an insurance policy.
Insurance premiums are paid for policies that cover healthcare, auto, home, and
life insurance.
Failure to pay the premium on the part of the individual or the business may result
in the cancellation of the policy and a loss of coverage.