Legal Definitions - master policy

A master policy is a single insurance contract that provides coverage for a group of individuals or multiple properties under one overarching agreement. Instead of each person or entity having a separate, full policy, they are covered by the terms and conditions of this single master contract. Those covered typically receive a certificate of insurance as proof of their individual coverage under the master policy.

Here are some examples to illustrate how a master policy works:

• Employee Health Benefits: A large manufacturing company decides to offer health insurance to all its full-time employees. Instead of each employee individually purchasing a health insurance plan, the company enters into a single agreement with an insurance provider. This agreement is the master policy. Each employee then receives an insurance card and a summary of benefits, which serves as their certificate of coverage, detailing their specific benefits and deductibles under the company's overarching plan. This demonstrates how one master policy can cover a large group of individuals.

• Condominium Association Insurance: A condominium association is responsible for insuring the common areas and the structural integrity of the entire building complex. The association purchases a single insurance policy that covers the exterior walls, roof, shared hallways, recreational facilities, and the overall liability for the property. This comprehensive contract is the master policy. Individual unit owners are typically responsible for insuring the contents and interior of their own units, but the master policy ensures that the shared infrastructure and common elements are protected. This illustrates a single policy covering multiple properties and shared spaces.

• Group Travel Insurance: A university organizes an international study abroad program for 50 students. To ensure all participants are covered for medical emergencies, trip cancellations, or lost luggage during their travel, the university purchases a single travel insurance plan for the entire group. This single contract is the master policy. Each student participating in the program receives a document outlining their specific coverage details and emergency contact information, acting as their individual certificate of insurance under the university's group plan. This shows a master policy covering a temporary group of individuals for a specific event.