Unearned Premium Insurance
Definition of "Unearned premium insurance"
Coverage for loss of unearned premium if insured property is destroyed before the end of a policy period. The policyholder pays in advance for insurance, but the insurer does not earn the premium until coverage is provided. For example, if a policy period is one year, one-twelfth of the premium is earned each month. After six months, one-half of the premium is still unearned and belongs to the policyholder if the policy is canceled. If the property is destroyed in the second month and the insurer pays the claim, the policyholder would have nothing left to insure. Unearned premium insurance reimburses the insured for the part of the premium paid up front that is no longer needed for insurance coverage.
Popular Insurance Terms
Federal law passed in 1920 that allows any seaman incurring bodily injury as the result of the performance of one or more functions of the job to bring a suit for damages against the ...
Payment of premiums and benefits as they come due. In pension plans, known as the "pay as you go basis." The plan depends on new employees coming into the work force so that their ...
Property damage resulting from aircraft traveling faster than the speed of sound. Although the vibrations caused by such high speed can cause damage, it is excluded on most property forms. ...
Charitable planning strategy under which a donor transfers title to his or her residence or farm to the charity. Upon transfer of title, the donor reserves the right to occupy the property ...
Allocation of funds in a retirement plan. ...
Arrangement by an employer in which employees share in profits of the business. To be a qualified plan, a predetermined formula must be used to determine contributions to the plan and ...
Sum of insurance provided by a policy at death or maturity. ...
Property damage coverage for a vehicle under the collision insurance and comprehensive insurance sections of the business automobile policy (BAP) and the personal AUTOMOBILE POLICY (PAP). ...
Injury covered in a health insurance policy that is isolated from any previous injury. ...
Have a question or comment?
We're here to help.