When an insurance policy pays out, the person who has the policy receives the money that they are entitled to receive. Many policies pay out only after a period of weeks or months. see also payout
A payout is a sum of money, especially a large one, that is paid to someone, for example by an insurance company or as a prize. long delays in receiving insurance payouts. a large payment of money to someone, for example from an insurance claim or from winning a competition