Insurance premium receivables explained
A premium receivable is an outstanding premium amount that the insurer tracks until payment, adjustment, cancellation-related accounting, or other permitted resolution. It should not be confused with claims payable, which represents obligations to pay covered claims.
Example
An insurer bills $800 and receives $500. If the $800 remains valid and the payment is correctly applied, the remaining premium receivable is $300. Any endorsement, refund, reversal, or adjustment can change that amount.
What finance teams measure
- Premium receivables aging by policy and product
- Applied cash and payment reversals
- Unmatched or unapplied payments
- Disputes, write-offs, and account adjustments
- Resolution time for premium billing exceptions
Written premium, earned premium, cash collected, and premium receivables are different financial concepts. Financial reporting should follow the insurer's applicable accounting basis.
Explore the Insurance Receivables CFO Guide and Agentic Payments.