What is an endorsement in an insurance context?

In the context of insurance, an endorsement refers to a written amendment that modifies the coverage of an existing insurance policy. This could involve adding new coverage, deleting coverage, or changing the terms and conditions of the policy. Endorsements are essential tools for personalizing insurance contracts to meet the specific needs of the policyholder, allowing them to tailor their coverage without having to purchase a completely new policy.

This terminology is often used in various insurance fields, including property, auto, and liability insurance, and it enables both the insurer and the insured to clearly document changes to the coverage. For example, a homeowner might add an endorsement to cover a newly purchased valuable item that is not included in the original policy. This flexibility helps ensure that the policyholder has adequate and appropriate coverage reflecting their current situation.

The other options do not accurately define what an endorsement is. An increase in premium cost pertains to pricing rather than amendments to the policy itself. A new policy sold to the same customer does not equate to an endorsement; it is a separate transaction. Lastly, a claim filed by a policyholder refers to a request for compensation based on the policy, which is a different aspect of the insurance process entirely.