Washington State Insurance Practice Exam 2025 – Comprehensive All-in-One Guide to Exam Success!

In insurance terminology, the term "insured" specifically refers to the individual or entity that is covered by the insurance policy. This coverage provides financial protection against losses or damages as stated in the policy. The insured is the party that holds the policy and has certain rights and obligations under it, including the right to make a claim in the event of an incident covered by the policy.

For instance, if a homeowner purchases a homeowner's insurance policy, the homeowner is the insured, meaning they are protected against risks covered in the policy, such as damage to their home or liability claims. This is fundamental to understanding the roles in an insurance contract, as it establishes who is eligible for benefits and protection under the terms of the policy.

The insurance company is the provider that issues the policy and takes on the risk, while third parties may be involved in claims situations but are not insured under the contract. Lastly, claims adjusters are employees of the insurance company who assess claims but do not have any coverage themselves under the policy.