From the insurance company's perspective, what is the difference between written premium and earned premium?
A) There is no difference; they are effectively the same thing.
B) Written premiums are those that belong to the insurer; earned premiums do not belong to the insurer.
C) Written premiums are the total premiums collected by the insurer; earned premiums are those that belong to the insurer.
D) Written premiums reflect the total amount of coverage provided to insureds; earned premiums reflect the net profit of the insurer.

Question

Quizplus · Accepted Answer

Written premiums are the total premiums collected by the insurer, while earned premiums are the portion of the written premiums that the insurer has earned by providing coverage for a certain period of time. In other words, earned premiums are the portion of the written premiums that have been recognized as revenue by the insurer.

From the Insurance Company's Perspective, What Is the Difference Between