How to Calculate Cancellation Policy Commission ?

[tandao]

Hi, first time poster and have a few newbie questions.

I have a general question about when a policy with endorsement is cancel how return premium and commission is calculated?

Example: An annual policy Premium of $1000, and in mid term an endorsement Premium of $500.

When this policy is cancel on 3/4 of the term. How would the return premium & commission be calculated? Do Insurance company calculate return premium for the Policy separately from the Endorsement? or They will calculate a single return premium and commission for the Policy and Commission combine together?

In another word, how would insurance company paid commission for the policy with endorsement?

- Do they paid commission for the policy separately from the endorsement?

When the policy with endorsement is cancel, how would the return commission be calculated?

- A return portion of the policy separate from the return portion of the endorsement? or It will be total return for the Policy and Endorsement together?

Is there a Standard way to calculated cancellation with endorsement or each insurance company do differently?

Thanks for your time to answer my newbie questions.

 

[justinking]

Re: How to Calculate Cancallation Policy Commission.

Hi tandao,

I'm a newbie too .

I believe different insurance companies will have different policies on the questions you have raised. Even if there is a standard way to calculate the amount, the exact number would vary from company to company. This is my understanding because as far as I'm aware companies have their own criteria and process to calculate all such numbers under different circumstances.

Hope we get some specific data from experienced members here.