Which term refers to both the premium paid by the insured and the insurer's promise to pay a covered loss?

The correct term that refers to both the premium paid by the insured and the insurer's promise to pay for a covered loss is "consideration." In insurance contracts, consideration refers to the exchange of value between the parties involved. The insured provides a premium payment, and in return, the insurer promises to compensate the insured for covered losses, fulfilling its obligations under the policy.

This mutual exchange is essential for the validity of the insurance contract, as it demonstrates that both parties are providing something of value—one party provides monetary payment, while the other commits to providing financial protection under specified circumstances. Without consideration, an insurance contract would not be enforceable, since there would be no exchange of value.

Indemnification refers to the process of compensating for a loss or damage, while a covenant is more related to a formal agreement or promise in a contract. A warranty generally refers to a guarantee on certain conditions or performance, but it does not encompass the entirety of both the premium payment and the insurer's promise like consideration does.