What does the term "Capital Sum" refer to in insurance?

The term "Capital Sum" in insurance specifically refers to the predetermined amount that is paid to an insured individual in the event of a specified loss, such as the loss of a limb or an eye. This payment is a set sum that can vary based on the terms outlined in the insurance policy and is not based on a percentage of another amount. In accident and health insurance, the capital sum often correlates directly with losses outlined in the contract, where specific sums are designated for different types of injuries.

It is important to understand that this payment is distinct from other types of compensation provided by insurance, such as a total policy value or disability claims, which encompass broader concepts. The capital sum is aimed specifically at providing financial relief for significant physical injuries sustained, thus emphasizing its role in personal injury policies, rather than covering ongoing costs or variations in claim amounts.