What is the term for the amount an individual pays for an insurance policy?

The term for the amount an individual pays for an insurance policy is "premium." This is the regular payment that policyholders are required to make to maintain their insurance coverage. The premium is typically paid on a monthly, quarterly, or annual basis, and it can vary based on factors such as the type of insurance, the coverage limits, the risk profile of the insured individual, and various underwriting criteria.

In the context of insurance, the premium is crucial because it is the way insurers collect funds to cover potential claims. In essence, by paying the premium, the policyholder secures the promise from the insurance company to provide financial protection against specific risks as outlined in the policy. Understanding the concept of a premium is essential for individuals managing their personal finances and evaluating their insurance options.