What constitutes an "insurance policy" according to North Carolina law?

An "insurance policy," according to North Carolina law, is defined as a written contract between an insurer and the insured that provides insurance coverage. This definition underscores the formal nature of insurance policies, emphasizing that they must be documented in writing to ensure clarity and legal enforceability. The written contract outlines the specific terms and conditions of the coverage provided, including what risks are insured, the limits of coverage, any exclusions, and the obligations of both parties.

This written nature is crucial for establishing legal rights and responsibilities, as it serves as a reference point in case of disputes or claims. Furthermore, the formal contract nature helps mitigate misunderstandings that could arise from mere verbal agreements, which lack legal standing and can be difficult to enforce.

Insurers often provide detailed documentation clearly stating the various aspects of the coverage, enabling insured parties to understand the extent of their protections. Thus, the definition aligns with the general principles of contract law, reinforcing the necessity for formal agreements in financial and legal transactions such as insurance.