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Billie Said:

can a florida insurance company charge 10% of unearned premium for early cancellation?

We Answered:

Progressive charges this, and many other companies do, too - it's called a short-rate cancellation penalty.

Yes, they can.

Raymond Said:

Accounting Problem - How do I come up with the correct answer?

We Answered:

$18000 premium is $1500 per month. As of Dec 31, the Insurance Co still has to provide insurance for 3 more months. Therefore, $4500 is "unearned revenue."

Sonia Said:

Accounting help! I have attempted to answer, but would like to make sure I am answering correctly.?

We Answered:

I don't have a lot of time, but here's a few:

2) income statement

4) assets

7) transaction

9) one year or less

11) the adjustment process

13) Net increase in assets of $40,000 and a net increase in liabilities of $40,000

15) the list price plus the sales tax.

18) administrative expense

Bruce Said:

. Wilson Insurance Co. received $10,000 from a customer on?

We Answered:

A) Premium Income 6,667
Unearned Premium Income 6,667

Two thirds of the premium is unearned at 12/31. Two thirds of $10,000 is $6,667.

The entry would be a

Debit to Premium Income $6,667
Credit to Unearned Premium Income $6,667

Regina Said:

I intentionally let my insurance lapse. I do not own the vehicle. Can I be charged after the money runs out?

We Answered:

You have a good company that allowed you to run a few weeks without payment so that you wouldn't be uninsured. If they billed you for that time, you should pay it since they did cover you. What you should have done of course was to call and cancel your policy, then you wouldn't be in this situation.

Also, some states require insurance to report to them when a policy is unpaid, and the state will then revoke your license to drive, another good reason to never let a policy lapse.

Holly Said:

Can I pre-pay my health insurance for 5 years?

We Answered:

I have never heard of a company which will allow a 5 year payment. I don't think they are set up for this logistically because this is not a common request. Premiums with most plans increase annually based on claims history of that company and there is no way to accurately forecast future premiums. If they were able to accept a 5 year payment they would retain the right to modify the coverage of the plan (for everyone on the plan, not just you) but they would not by law be allowed to drop you. If you want to do this you'll need to have your agent contact the companies to see if they could.