A policy cancelled on the effective date. Usually, no premiums have been paid.
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REFERENCE: See: Cancellation.
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US: The cancellation of an insurance policy or bond as of its effective date, before the insurer has assumed liability. This requires the return of paid premium in full since the insured has never been covered under the policy.
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When liabilities have not existed thereunder, policies may be cancelled free of any charge to the insured. Such terminations are knows as flat cancellations.