Advertisement

Amount of Insurance

What Does Amount of Insurance Mean?

The amount of insurance is the amount of money that an insurance company is willing to provide financial coverage for, for a specific policy. For example, if your homeowner's insurance policy has a limit of $300,000, then the amount of insurance you have for this policy would be $300,000. You are responsible for losses over this limit.

Advertisement

Insuranceopedia Explains Amount of Insurance

Insurance policies that have a higher amount of insurance generally tend to cost more. However, these policies also tend to provide more coverage for their policyholders than the cheaper alternatives. How much insurance a person needs depends on their individual circumstances. Many people, for instance, will purchase the state minimum amount of auto insurance. However, those who drive a lot, or who believe they are more prone to accidents, may choose an auto policy with a higher amount of insurance.

Advertisement

Share this Term

  • Facebook
  • LinkedIn
  • Twitter

Related Reading

Tags

InsuranceLife InsuranceAuto InsuranceThe Insurance Business

Trending Articles

Go back to top