Insured

Reviewed by Stefan Tirschler

Noun

in·sured | ɪnˈʃʊrd

Definition: A person or other entity covered by insurance.

The insured may submit changes to their policy whenever they wish.

What is an insured?

In insurance, the insured is the person or business that is covered by an insurance policy. One policy can (and usually does) cover multiple insureds.

Example

Stanley is a homeowner who lives with his two kids, his wife, and her father. Stanley bought the insurance policy that protects their home, and it’s his name written on the front of the policy. However, his insurance policy extends coverage to Stanley’s partner, his relatives, and his partner’s relatives, as long as they’re living with him in the house.

In this example, Stanley is the named insured: his name specifically appears on the policy. The terms of his home insurance policy extend coverage to the other people living with him: his kids, his wife, and his father-in-law are all considered insureds under his policy, even though the policy doesn’t name them specifically.

Policies of insurance always have a named insured, and sometimes more than one. Plus, insurance policies often extend coverage to people who aren’t actually named on the policy.

Home insurance policies typically cover family members of the named insured if they’re living in the same household. Commonly, children who are living away from home for school are also insured.

Insurance companies often differ slightly in their definition of insured. You’ll be able to find your insurer’s definition somewhere in your policy wordings.

Square One’s definition of an insured includes the named insured, plus:

  • Living in the same household:
    • The named insured’s partner
    • Relatives of the named insured or their partner
    • Anyone under 21 years old in the care of the named insured or their partner
    • Any domestic employees
  • Living outside the household:
    • The parents of the named insured or their partner, while they live in a residential care facility
    • Any students who are dependent on the named insured or their partner

What is the difference between insured and insurer?

Now that we’ve defined insured, what’s an insurer?

An insurer is the company that is insuring the insured. Or, less confusingly: the insurer is the company that agrees to cover the insured’s claims under the policy. If the insured makes a claim, the insurer is the one who pays the claim settlement.

Often, the insurer will be the same company that sold the policy, though not always.

If you bought your insurance policy through a broker, that broker is not your insurer. The insurer is the company that underwrites the policy and pays any claims. Your insurer is clearly identified on your policy’s declarations page.

The important points

  • Insured refers to anyone covered by the policy, whether they’re specifically named or not.
  • Different insurance companies define “insured” differently.
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