What is typically the result of an endorsement to a policy?

An endorsement to a policy is typically a change or addition that alters the terms of the insurance contract. When a policyholder adds an endorsement, it often leads to an increase in premium costs because endorsements usually provide additional coverage or enhance existing protections. For instance, a policyholder may add coverage for special items, increase liability limits, or include riders for specific risks, all of which can justify a higher premium.

This reflects the nature of endorsements as they are used to tailor the insurance policy to better meet the policyholder's needs, often at an additional cost. While some endorsements might provide clarifications or standardize language, they primarily serve to expand or alter coverage, which typically results in an increase in the premium as the insurance company assumes more risk.

Reducing coverage limits, standardization of policy language, or increasing deductibles does not directly correlate with the purpose or typical outcome of adding an endorsement. Instead, these actions generally indicate a different approach to managing risk or modifying the terms of the policy, distinct from the typical function of an endorsement.