Unearned Premium(redirected from Prepaid premiums)
A premium paid on an insurance policy before it is due. For example, one may pay six months' worth of premiums in January instead of paying each month from January to June. If the policyholder cancels before February, the insurer should refund the premiums for March, April, May and June. For that reason, they are listed as liabilities on the insurer's balance sheet.
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