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Simple English definitions for legal terms
insuring agreement
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A quick definition of insuring agreement:
Insuring Agreement: An insuring agreement is a part of an insurance policy that explains what risks the insurance company is willing to cover and the extent of that coverage. It is also known as an insuring clause. This agreement outlines the terms and conditions of the insurance policy and helps the policyholder understand what they are protected against.
A more thorough explanation:
An insuring agreement, also known as an insuring clause, is a provision in an insurance policy or bond that outlines the risk assumed by the insurer and the scope of coverage provided.
For example, a homeowner's insurance policy may include an insuring agreement that covers damage to the home and personal property caused by fire, theft, or other covered perils. This means that if the home or personal property is damaged or destroyed by a covered peril, the insurer will provide compensation to the policyholder.
Another example is a liability insurance policy for a business. The insuring agreement may state that the insurer will provide coverage for bodily injury or property damage caused by the business's operations or products. This means that if someone is injured or their property is damaged as a result of the business's actions, the insurer will provide compensation to the injured party.
Overall, the insuring agreement is a crucial component of an insurance policy as it outlines the specific risks that are covered and the extent of the coverage provided.