What is the term for the periodic payment made on an insurance policy?

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Multiple Choice

What is the term for the periodic payment made on an insurance policy?

The periodical payment made to keep an insurance policy active is called the premium. This is the price you pay to obtain and maintain coverage, typically due at regular intervals such as monthly, quarterly, semiannually, or annually. The premium funds the insurer to cover claims and administrative costs, and its amount can vary based on factors like risk, coverage limits, and deductibles. The other options refer to related ideas but aren’t the standard term: one describes the cost of coverage in general, another points to a fee for adding beneficiaries (a rider or endorsement), and the last refers to the policy’s maximum payout, not a payment.

The periodical payment made to keep an insurance policy active is called the premium. This is the price you pay to obtain and maintain coverage, typically due at regular intervals such as monthly, quarterly, semiannually, or annually. The premium funds the insurer to cover claims and administrative costs, and its amount can vary based on factors like risk, coverage limits, and deductibles. The other options refer to related ideas but aren’t the standard term: one describes the cost of coverage in general, another points to a fee for adding beneficiaries (a rider or endorsement), and the last refers to the policy’s maximum payout, not a payment.

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