What is the function of an endorsement in an insurance policy?

An endorsement serves the primary function of modifying the terms of the original insurance policy. It allows insurers and policyholders to make changes or updates to the coverage without needing to create an entirely new policy. This can include adjusting coverage limits, adding or removing specific coverages, or changing deductibles or exclusions. By issuing an endorsement, the insurer can tailor the policy to better meet the needs of the policyholder or adapt to changes in circumstances, such as acquiring new property or changing risk factors.

While endorsements can indeed result in increased coverage limits, that is just one potential outcome of the modification process, not the overall function of an endorsement itself. It is also important to note that an endorsement does not serve as a means to cancel the original insurance policy or provide temporary coverage; those functions would fall under other provisions or types of documents within the insurance framework. Thus, the core role of an endorsement lies in its ability to make specific amendments to the policy, ensuring that it remains relevant and effective in protecting the policyholder's interests.