What is the Meaning of Insurance Premium?
August 12th, 2009An insurance premium is the payment you make to your insurance carrier to “rent” your policy. The word “premium” as it applies to insurance is just a fancy word for “rates” or “costs.” You can substitute either word in the phrase “what are monthly auto insurance premiums in nyc?”
An insurance premium may be paid monthly, quarterly, semiannually or annually.
At one time life insurance premiums were collected weekly. This is back in the days of the debit agents. These agents went door-to-door and sold small policies and collected premiums.
Insurance premiums can be guaranteed for the life of a policy as with some life insurance policies. They can also be subject to increase at any time as with some health insurance policies.
The money you pay your insurance company to keep your policy active is your premium. This may be one aspect of insurance that isn’t complicated.