Insurance Contract

An insurance contract is a legally binding agreement between an individual (the policyholder) and an insurance company. In this contract, the policyholder pays regular payments, known as premiums, in exchange for financial protection against specific risks, such as accidents, illnesses, or property damage. If a covered event occurs, the insurance company compensates the policyholder or pays for the damages, according to the terms of the contract. The contract outlines the coverage details, exclusions, and obligations of both parties, ensuring a mutual understanding of the protection provided.