If you set a policy to cancel immediately or to cancel on a specific date, you can select whether or not to apply the minimum earned premium. Minimum earned premium is the least amount of earned premium that an insurance carrier requires to insure a policy. If a policy is canceled early in the term before the actual earned premium has exceeded the minimum earned premium, the insurance carrier will keep the minimum earned premium and refund the unearned premium.
Note: To apply minimum earned premium when you set policies to cancel immediately, you must set up a static amount for minimum earned premium or set up a calendar based minimum earned premium. If you don’t set up a minimum earned premium, the Apply Minimum Earned Premium dropdown list won’t display in the Cancel Policy dialog box.
Apply minimum earned premium when canceling a policy
To apply minimum earned premium when you set a policy to cancel immediately:
- In the BriteCore menu, select Policies.
- On the Policies List screen, select a policy number to open a policy.
- Under the Additional Description box, select the Cancel Policy button to open the Cancel Policy dialog box.
- From the Cancel When dropdown list, select Cancel Immediately or Cancel on Specific Date.
- If you select Cancel on Specific Date, type the date you want the policy to cancel in the Cancellation Date boxes.
- From the Apply Minimum Earned Premium dropdown list, select Yes to apply minimum earned premium.
Note: By default, the Apply Minimum Earned Premium dropdown list is blank. You must select Yes or No from the Apply Minimum Earned Premium dropdown list to cancel the policy.