Insurer

• An insurer is the company that offers insurance to its customers. Insurance companies offer financial protection to their customers during times of need in exchange for continual payment. Insurers identify and calculate the terms of risk they expect from their customers using actuarial science. This uses statistics to determine the possibility that a situation might occur. Insurers use this information to decide how much they will charge every individual policyholder. Not all customers pay the same amount because not all customers have the same level of perceived risk.
  
  

Policy

• An insurance policy is the written agreement between an insurer and customer. A policy spells out the terms and arrangements offered by an insurance company. An insurance company's customers are referred to as "policyholders." In exchange for coverage, insurers receive a premium payment from a customer on a scheduled basis, usually by month. The amount of the premium will depend on several factors, including the amount of the deductible selected by the insured.
  
  

Collision Coverage

• Auto insurance offers a variety of different forms of coverage for consumers. One type of coverage is known as "collision coverage" and pays for auto damage sustained to a car, either by the policyholder's fault, or that of another driver. Collision coverage is subject to deductible agreements. A deductible is the amount that a policyholder must pay out of his own pocket before the insurer will pay. Insurers offer policies with varying levels of deductible amounts, with high deductible policies costing less money for the premium.
  
  

Co-Pay

• Health insurance is used to alleviate the costs of medical services and prescription medications, but does not always cover the entire cost. Co-pay represents the insured's financial responsibility with regard to paying doctors' offices or pharmacies. An example of this is that a doctor's visit might cost $200 for an uninsured patient, but someone who is covered by an insurance policy will only pay $20. Co-pay also extends to prescriptions, as insurance companies will pay some or most, but usually not all, of the expense for medication.