Parts of the insurance contract
. daclaration,Insuring Agreements, Conditions, exclusions, and Definitions.
Since an insurance policy is a legal contract, it must be very specific about the agreements between the insured and the insurer.
To do this, most policies contain five parts: declarations, insuring agreements, conditions, exclusions, and definitions.
The declarations, which are almost always on the first page of the policy, contain such information as the name of the insured, the address, the amount of coverage provided, a description of the property, and the cost of the policy.
The insuring agreements, the heart of the policy, state in general what is to be covered or, in other words, the losses for which the insured will be indemnified. This section also describes the type of property covered and the perils against which it is insured.
The conditions state the ground rules for the policy.
They describe the responsibilities and the obligations of both the insurance company and the insured.
The exclusions describe the losses for which the insured is not covered. If an excluded loss occurs, the insured will not be indemnified.
Finally, the definitions section clarifies the meanings of certain terms used in the policy.
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