What does Premium Payment Plan mean? Read on to discover the definition & meaning of the term Premium Payment Plan - to help you better understand the language used in insurance policies.
Premium Payment Plan
A payment plan or installment plan that does not require an insured to pay the entire annual premium at the beginning of the policy period. This allows an insured to enjoy investment earnings on premium dollars during the time between payment of the premium at the policy's inception and the time of the actual loss. Three common types of premium payment plans include deferred premium plan, lagged premium plan, and discounted premium plan.
We hope the you have a better understanding of the meaning of Premium Payment Plan.