by evan » Sat Jul 08, 2006 05:53 am
Earned Premium
The portion of premium that applies to the expired part of the policy period. Insurance premiums are payable in advance but the insurance company does not fully earn them until the policy period expires. Earned premium calculation is done on this basis.
The portion of premium that applies to the expired part of the policy period. Insurance premiums are payable in advance but the insurance company does not fully earn them until the policy period expires. Earned premium calculation is done on this basis.
Posted: Thu Dec 21, 2006 06:38 am Post Subject: Earned Premium calculation
Please explain the differences in earned premium calculation using the 1/24th method or the 1/365th method.
Posted: Fri Dec 22, 2006 08:09 am Post Subject: explanation!
hey !
its a real good one to discuss..
Today, I truly feel glad to say that with the advent of the computers earned premium calculation has become a real easy thing for us, by grouping the premiums as per the time-frame to cover and the month of writing. The method is called the "twenty-fourths" method. We have taken it in a way that for a certain month the premium receipts written would be dispersed after passing half of each month thereby ensuring an identical business for each fortnight (Avg. Due date for each month would be 15th).
Thus an annual premium of FF2400 recorded on 25 July would be brought forward as- 2400x13/24=1300. Hope you got that in a better way now. Thanks, Thomas Bracken.
Posted: Fri Jun 03, 2011 12:40 pm Post Subject: LWYyzJxOYlk
About906.. Great idea :)
Add your comment