Premium Deficiency Reserves-inconstancies In Practice

At a basic level a premium deficiency exists when unearned premium and expected future premium are not sufficient to cover future estimated losses, loss adjustment expenses, policy acquisition costs and maintenance costs. In other words, a premium deficiency reserve is required if you expect a net loss in future periods for the particular policy, line of business, segment or company that has already been written.
Divergence in practice have evolved regarding at what level one should apply their analysis and which method should be used to calculate any resulting reserve. Should one look to the policy level, and perform a review of multiple contracts or do one high level review? Once you determine you have a premium deficiency how should you calculate the premium deficiency reserve?

To answer these questions we first have to understand the theory and guidance relative to premium deficiency reserves. We will also look quickly at how practices have evolved over time in different segments of the insurance industry
Guidance on Premium Deficiency Reserves
Generally Accepted Accounting Principles (GAAP) and Statutory Accounting Principles (SAP) are fairly consistent in their definitions of premium deficiency reserves. The general premise is that a premium deficiency

Get The Cheapest Quotes For Your Auto Insurance

Every person driving a car in any state in the United States is mandated by law to carry automobile insurance. There are some states, however, that allow a driver to pay a certain fee to be able to drive without insurance. Though it is an option, it will not be advisable or recommended that one drives a car without any insurance coverage as this will prove to be regrettably costly and might cause you huge financial setbacks. Typical auto insurance could range from collision to liability to roadside assistance. Having car insurance will not only benefit the car owner but the society as well. When accidents happen, responsibility is identified together with who is accountable for the expenses incurred say, in repairing damaged property of the state or the federal government.

As there are numerous car insurance companies offering different coverage plans with corresponding insurance quotes. There are insurance companies that will offer cheapest quotes but you will have to check the coverage included in the policy. You can narrow down your selection to insurance providers offering the lowest rates. From the quotes you receive, you can check the inclusions in the policy in terms of expenses to be

Auto Deductible Reimbursement – What Is An Auto Deductible Reimbursement

Q: There is a clause in my insurance policy that talks about something called auto deductible reimbursement. I have never heard of this before. Can you explain what this means? Thank you.

A: An auto deductible reimbursement is actually a good thing to have. It usually only costs a few dollars a month and will pay you back your deductible, usually up to $500 dollars, in the event you are in an accident.

Most, if not all, insurance policies require you to pay a deductible in the case you have to file a claim. For instance if you are in a covered accident and your car will cost $1000 dollars to get fixed, your are responsible for the deductible on your policy. So you would pay $500 dollars and your car insurance company would pay $500.

If you have an auto deductible reimbursement policy in the above instance you will receive your $500 dollars back under the terms of the policy. In the case outlined above your out of pocket expenses would be zero if you have auto deductible reimbursement insurance. This type of policy can usually be added as a rider to your existing policy or it can be

Full Coverage Auto Insurance Quotes Compare Fees and Save

You’re aware that you must have auto insurance, but you might not be aware of the difference between full coverage and liability. Full coverage auto insurance is a protection plan that will cover not just liability lawsuit fees resulting from a car accident, but also any costs for repairs and your medical costs. It will even take care of you should you be involved in an automobile crash with an uninsured or underinsured driver. However to get an affordable policy, you will need full coverage auto insurance quotes.

This sort of insurance coverage can be obtained on a long-term basis or even month-to-month. You can find selections available in your price range. Raising your deductible lowers your monthly premium, but if you ever need to exercise your policy, you’ll be responsible for more of the costs up front.

In the event that you need your full coverage policy, you should contact the police department so that an official police report can be filed. This will be very helpful when submitting your claim. Whenever you call to make a claim, make sure you supply the insurance agent with as much information as possible, but the specific location, date and

How To Save $500 On Gap Auto Insurance

The average price for gap auto insurance sold by an auto dealership or finance company is $578.

Q. So why would anybody in their right mind pay $500 more they should?

A. They dont know any better.

Imagine youre in a car dealership and youve just purchased a brand new car. Youre sitting there with a self satisfied smile on your face that lets everybody in the showroom know you just brought the salesman to his knees with your finely honed negotiating skills.

Next you go see the finance person to arrange a loan. This is where youre casually informed that if you wreck your beautiful new car during the next year or two youre going to have fork over maybe five grand because the car will be worth that much less than what you still owe the bank.

Lucky for you the finance guy has a tailored made solution to the problem. For a measly $578 one time fee you can purchase a gap policy that protects you from a potential shortfall, up to $5,000, if you owe the bank more than the car is worth when that bus hits you.

Of course youre going to say