A payment plan or installment plan that does not require an insured to pay
the entire annual premium at the beginning of the policy period. This allows
an insured to enjoy investment earnings on premium dollars during the time between
payment of the premium at the policy's inception and the time of the actual
loss. Three common types of premium payment plans include deferred premium plan,
lagged premium plan, and discounted premium plan.
Links for IRMI Online Subscribers Only: