Insurance Indemnity (Payout, Compensation)

Insurance compensation (insurance indemnity) — the monetary amount that the insurer pays to the insured, a third-party beneficiary, or the harmed party upon the occurrence of an insured event, with the purpose of compensating for the incurred losses within the agreed insurance coverage. In property insurance, the amount of insurance compensation cannot exceed the value of the loss at the time the insured event occurs.