Quid Pro Quo
What Does Quid Pro Quo Mean?
Quid pro quo is relevant in insurance because it is a simplified breakdown of the underlying concept of an insurance contract. In an insurance contract, a policyholder pays a premium to an insurer in order to have certain risks covered financially. However, once the policyholder stops paying premiums, the situation is no longer a quid pro quo and the insurer will generally stop providing insurance coverage to the individual or group who owned the insurance policy.
Insuranceopedia Explains Quid Pro Quo
Quid pro quo is relevant in insurance as it simplifies the fundamental concept of an insurance contract. In such a contract, the policyholder pays a premium to the insurer in exchange for financial coverage of certain risks. However, if the policyholder stops paying premiums, the quid pro quo arrangement ends, and the insurer typically ceases to provide coverage to the individual or group that held the policy.
