Who does an insurance contract primarily cover?

An insurance contract primarily covers the insured. The insured is the individual or entity who purchases the insurance policy and is protected against various risks outlined in the contract. The purpose of the insurance is to provide financial compensation or assistance to the insured in the event of a specified loss or damage, as defined in the policy terms.

This coverage is fundamentally the essence of what insurance is all about: transferring the financial burden of certain risks from the insured to the insurer. The insurer takes on this responsibility in exchange for the premiums paid by the insured. Thus, the insured is central to the contract's function, as they are the ones benefitting from the coverage in times of loss or need.

While other roles in the insurance process, such as the underwriter, insurer, and beneficiary, play important parts in the overall structure and execution of the insurance contract, it is the insured who is the focus of the coverage provided. They stand to gain protection and support in accordance with the contract terms.