When the terms of a policy provide that the final earned premium be determined at some time after the policy itself has been written companies may require tentative or “deposit” premiums at the beginning which are readjusted when the actual earned charge has been later determined.
***
When the price of insurance is tied to fluctuating values or costs that cannot be known until the end of the policy period, inventory or payroll are two common examples, a deposit or provisional premium or estimated premium may be charged at the outset of a policy with final adjustment to come at the end of the term.

The amount of premium that Lloyd’s Name may write in a given year, determined by the size of the Name’s wealth, deposit and whether or not incorporated.

The portion of the premium calculated to enable the insurer to pay losses and in some cases, allocated claim expenses or the premium arrived at by dividing losses by exposure and in which no loading has been added for commission, taxes and expenses.

A fund into which all premiums for a Lloyd’s syndicate in a given underwriting year are paid. No moneys may be released from the fund other than any profit on closure and ongoing claims and expenses.

In reinsurance, this term is applied to the nouns: insurer, insured, policy and insurance and means respectively: 1) the insurance company that initially originates the business, i.e., the ceding company; 2) the policyholder insured by the primary insurer; 3) the initial policy issued by the primary insurer to the primary insured; 4) the insurance covered under the primary policy issued by the primary insurer to the primary insured (sometimes called “underlying insurance”).
***
Basic, fundamental; an insurance policy that pays first with respect to other outstanding policies.

A clause whereby the Reinsurer agrees that he will be Directly liable to the original assured in the event that the reassured is unable to pay a loss.
***
UK: A clause under which the reinsurer agrees to pay losses directly to the insured. The clause is rarely used.

The term used in some reinsurance markets outside the U.S. to mean the retention of the primary company in a reinsurance agreement.
***
Legal preference.

A priority cession is Reinsurance which is ceded before Ceding to the Company’s normal treaties.

A generic term describing all forms of reinsurance in which the reinsurer shares a pro-rata portion of the losses and premiums of the ceding company. Also called Share and Participating Reinsurance. Pro rata Reinsurance includes Quota Share Reinsurance and Surplus Reinsurance.
***
See: “Reinsurance, Pro-rata.”