Insurance Broker Certification Practice Exam

Who is considered the insured in an insurance policy?

1. The person who pays the premium

2. The person covered by the insurance policy

3. The insurance agent

4. The insurance company

The correct answer is: The person covered by the insurance policy

In an insurance policy, the insured is defined as the person or entity that is covered by the insurance protection offered by the policy. This means that in the event of a loss or damage that is covered under the policy, the insured is the party who would receive the benefits or compensation per the terms of the policy. Understanding who the insured is crucial, as it delineates responsibility and coverage under the agreement. This role does not necessarily coincide with the person paying the premium, who may be different from the insured individual. In other cases, an insurance agent is simply a representative of the insurance company facilitating the sale of the policy, and the insurance company itself is the entity that provides the coverage and compensation. Thus, the person or entity covered by the policy is clearly and unequivocally identified as the insured.