Question 2020 of 303 · California Life-Only Agent Exam
Which of the following best describes the difference between earned and unearned premium?
Exactly one answer is correct.
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Correct answer to question 2020
- C: Earned premium is the part for the time coverage has already been provided
Explanation
As time passes, the insurer earns the premium. The unearned part is the portion for coverage not yet provided, which is returned on cancellation.
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