What is an insurance policy: complete guide
What is an insurance policy: definition and key stakes
An insurance policy is the contractual document that formalizes the agreement between the insurer and the insured. Unlike a simple quote or insurance proposal, the insurance policy is the formal proof of both parties’ commitments. For insurance brokers and insurers, mastering this document is essential in day-to-day operations.
An insurance policy contains all the general and specific terms governing the contractual relationship. It specifies the purchased coverages, exclusions, premium amount, applicable deductibles, and cancellation terms. Each insurance policy is assigned a unique policy number that enables identification within management systems.
A deep understanding of what an insurance policy is helps professionals optimize underwriting processes and contract management.
The insurance policy number: identifying and managing insurance contracts
This policy number is valuable because it is the unique identifier of each insurance contract. Usually made up of digits (and sometimes letters), it facilitates administrative tracking and claims management.
For delegated authority brokers managing large volumes of policies, this identification system is critical.
Main uses of the policy number:
- Quick contract identification during exchanges with policyholders
- Full traceability of changes and endorsements
- Easier processing of claims notifications
- Automation of renewal workflows
- Better reporting for wholesale brokers
Modern management platforms like Korint centralize all policy numbers and automate tracking. This centralization significantly reduces errors and improves responsiveness to customer requests.
Each policy number must be systematically communicated to the insured at inception. It appears on all insurance contractual documents: specific terms, certificates, green cards for motor insurance, and policy endorsements.
What are the main types of insurance policies?
Home insurance policy: protecting assets
A home insurance policy covers risks related to the insured’s home. It typically includes private liability cover, protection against water damage, fire, theft, and natural disasters. For brokers, home insurance is often the first contact point with an individual customer.
Home insurance policies come in several plans tailored to occupancy status: owner-occupiers, tenants, or landlords. Each plan offers specific coverages adapted to the needs and obligations of each profile.
Motor insurance policy and the green card
A motor insurance policy formalizes the mandatory motor insurance contract for any motor vehicle. This legal obligation requires at least third-party liability cover for damage caused to others. The green card, a condensed document derived from the policy, certifies this coverage.
Brokers typically offer three main coverage levels:
- Third-party: covers only mandatory liability insurance.
- Intermediate: adds theft, fire, and glass breakage cover.
- Comprehensive: the most complete protection, including damage to the vehicle even when the driver is at fault.
The policy number should be carefully kept by the insured. It will be requested during roadside checks, claim notifications, or certificate requests.
Other essential insurance contracts
A professional liability policy protects businesses against financial consequences of errors or negligence. For brokers themselves, this cover is a regulatory requirement.
A supplementary health insurance policy complements national health reimbursements. These health contracts are structured around benefits tables detailing coverage levels for each care category.
A school insurance policy covers damage that children may suffer or cause during school and extracurricular activities. It includes liability and personal accident cover.
A travel insurance policy provides temporary protection for trips abroad, covering assistance/repatriation, medical expenses, and trip cancellation.
What are the essential components of an insurance policy?
General terms of the insurance contract
General terms define the contractual framework applicable to all insureds subscribing to the same insurance product. They specify definitions, core coverages, common exclusions, the insured’s obligations, and claims notification procedures.
For brokers, strong command of each partner insurer’s general terms supports better advice and helps avoid disputes.
Specific terms: tailoring the policy
Specific terms customize the policy to the insured’s situation. They include the policy number, full identity of the policyholder, insured persons or property, insured sums, chosen deductibles, and the premium amount.
Information typically included in the specific terms:
- Effective date and annual renewal date
- Exact description of insured property or activities
- Sums insured and coverage limits
- Deductibles by coverage
- Total premium and chosen payment frequency
Careful review of the specific terms before signature is fundamental: it prevents later misunderstandings. Professional brokers systematically check alignment between the client’s needs and the coverages written into the policy.
How can brokers better manage insurance policies?
Underwriting process and policy issuance
This stage begins with collecting the information needed to assess the risk. The broker completes a detailed insurance application, sent to the insurer for pricing. Once pricing is agreed and the proposal is accepted by the client, the insurer issues the policy with its unique policy number.
Modern platforms allow delegated authority brokers to issue insurance policies directly without prior insurer validation. This delegation significantly accelerates the process and improves the customer experience.
Changes and endorsements
Any change to an insurance policy during the contract term requires an endorsement. Endorsements keep the original policy number and receive a sequential number to track the change history.
Brokers handle endorsement requests daily: address changes, added coverages, or modified insured sums. Each endorsement requires agreement from both the advisor and the insured to amend the policy terms. What can be perceived as complex is made easy with solutions like Korint, which records every event on the platform.
Full endorsement traceability prevents later disputes and is therefore critical. Each change results in an updated certificate mentioning the policy number and the new applicable terms.
Digital optimization of policy management: what impact on your growth?
Centralization and traceability of policy numbers
Wholesale and delegated authority brokers manage hundreds or thousands of policies simultaneously. Centralizing all policy numbers in a single platform like Korint enables instant search and a consolidated view of the portfolio. This digital organization eliminates scattered Excel files and the related error risks.
A performant insurance management system automatically indexes each policy across multiple criteria: insurer, risk type, renewal date, premium amount. Brokers instantly access the complete policy history, including endorsements, declared claims, and exchanges with the insurer. The platform also provides access to every historical version of the policy, supporting the insured’s right to information.
Automation and digitization
Automating policy renewals is a major productivity gain for brokers. Modern systems automatically generate renewal proposals, calculate updated premiums, and alert brokers about upcoming deadlines.
Full digitization of insurance policies greatly simplifies management and archiving. Digital documents are timestamped, electronically signed, and securely stored. The insured accesses their policy through a customer portal using the policy number as an identifier.
Portfolio performance and steering
Commercial performance monitoring relies on deep analysis of the insurance policy portfolio. Wholesale brokers steer activity through indicators such as the number of new policies, cancellation rate, average premium per policy, and revenue evolution by segment.
In insurance, each policy is an opportunity to expand the customer relationship through cross-selling. A motor insurance customer is a qualified prospect for home, school, or travel insurance. High-performing brokers systematically map uncovered customer needs.
Conclusion: mastering the insurance policy to perform
The insurance policy remains the foundation of any contractual relationship in insurance. For wholesale brokers, delegated authority brokers, and insurers, perfect mastery of this contractual document determines service quality and operational efficiency. Whether it’s home insurance, motor insurance, or health insurance, each contract requires rigor and expertise.
The policy number, the unique identifier of each contract, structures the entire management system. Its traceability and centralization in powerful tools like Korint make it possible to industrialize processes while keeping customer relationships personalized.
Insurance professionals who invest in digital policy management gain productivity, reliability, and responsiveness.
AI is also becoming increasingly important to differentiate from competitors and improve efficiency. We explain here why AI in insurance will depend first and foremost on your management tools.