What is the difference between an insurance policy and an insurance contract?

An insurance policy and an insurance contract may appear to be the same, but there are subtle differences between the two. An insurance policy is the document that outlines the terms of the agreement between the insurer and the person seeking coverage. It lays out the details of the coverage, such as what is covered and at what cost. It also outlines any exclusions or limitations. An insurance contract, on the other hand, is the actual agreement between the insurer and the person seeking coverage. This agreement is legally binding and must be signed by both parties. It outlines the specific terms of the policy and any special conditions that may apply. In South Carolina, a person must have a valid insurance policy before they can enter into an insurance contract. This policy must be reviewed and approved by the state’s insurance commissioner. Once this step is taken, then an insurance contract can be drawn up and signed. In conclusion, the difference between an insurance policy and an insurance contract is that an insurance policy outlines the terms of the agreement, while an insurance contract is the legally binding document that outlines the terms of the agreement in more specific detail.

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