What does insurability mean?
Insurability is the quality of being eligible for insurance protection. An insurer considers many factors when assessing it, including the likelihood of loss, the value of the property or interest involved, the safety of the premises, and whether the risk falls within the insurer's policies and regulatory limits. Some risks are readily insurable, while others are difficult or impossible to cover because they present exceptional hazards or losses. In legal and commercial discussions, insurability may also refer to a person's or organization's eligibility to obtain coverage. The word is especially useful in explaining why two superficially similar properties may receive different treatment: beyond the object itself, insurability depends on its characteristics, surroundings, intended use, and the terms available in the insurance market. Although generally associated with property, it can also describe vessels, cargo, businesses, health risks, and other subjects that can be protected through insurance.
nounThe quality or condition of being insurable, especially the extent to which a person, property, activity, or risk qualifies for insurance coverage.
- The quality or condition of being insurable, particularly the extent to which a person, property, activity, or risk qualifies for insurance coverage.
"The unusually high flood exposure reduced the insurability of the property."
"The assessors examined the building's construction and location to determine its insurability."
"Low insurability may make it difficult for a small business to obtain affordable coverage."
The regular plural is insurabilities, although plural usage is uncommon; the singular is normally preferred.
"The report compares the insurabilities of properties in coastal and inland locations."
Insurability is the question behind countless decisions: can this risk be covered, and under what conditions?
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Where does insurability come from?
The word was formed by combining the verb insure with the suffix -ability, producing a noun meaning the quality of being able to be insured. Insure belongs to a wider family based on the idea of making something secure or certain, reflected in related forms such as insurance and assurance. The vocabulary ultimately draws on Latin roots associated with security and safety, although insurability itself is a modern English formation.
How insurability is actually used
A formal and specialized term used mainly in insurance, finance, law, and risk assessment. It is less common in everyday speech, where insurers more often speak of whether a risk or property is insurable.