Insurance is a way to manage unforeseen risks. The instrument by which it does this is a written contract between an insurer (the insurance company) and a policyholder (the individual or entity that obtains the policy) — these documents are the insurance policy.

An insurance policy remains in force for a specific period, known as the policy term. When the term ends, you usually have the option to renew the policy, terminate it, or purchase a new one. When you buy an insurance policy, you should understand what it covers, any exclusions that limit coverage, and the responsibilities you must fulfill for the insurance company to reimburse losses.

• Declaration Page: The insurance declaration page is the first page of your policy and identifies policy basics, including the insured, covered risks, policy limits, and the term of the policy.
• Insuring Agreement: The insuring agreement summarizes what the insurer promises to do in exchange for your premium.
• Exclusions: The exclusions section comes after the insuring agreement and highlights what your policy doesn’t cover.
• Conditions: The conditions section includes provisions that qualify or limit your insurer’s promise to reimburse or perform. The insurer can deny a claim if you fail to meet these conditions.