Premium
The amount you pay an insurer — monthly, quarterly or annually — to keep an insurance policy active.
What does premium mean?
The premium is the price of coverage. It’s set by the insurer based on the risk they’re taking on; higher coverage or higher risk means a higher premium. Letting a policy lapse for non-payment ends your coverage.
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Related terms
Premium — frequently asked
What determines my insurance premium?
Insurers price premiums on your risk profile — age, health, driving record, location, coverage amount and deductible. Lower risk and a higher deductible generally mean a lower premium; more coverage or higher risk raises it.
How can I lower my insurance premium?
Raise your deductible, bundle policies, improve your credit and claims history, and ask about discounts. Shopping and comparing quotes every year or two is one of the most reliable ways to cut the premium.