Amount of Insurance

Published: | Updated: January 25, 2017

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Definition - 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.

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.

How Well Do You Know Your Life Insurance?

The more you know about life insurance, the better prepared you are to find the best coverage for you.

Whether you're just starting to look into life insurance coverage or you've carried a policy for years, there's always something to learn.

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