uncollected and deferred premiums

  • In the Annual Statement under non-ledger assets appears the item "net uncollected and deferred premiums." The net deferred premiums arise because of the practice of permitting policyholders to pay premiums in installments, instead of yearly as is assumed on the reserve calculation. Because of the grace period, as well as bookkeeping work, some premiums payable during the last few months of the calendar year may not be reported as paid. In reality, however, such premiums are in the process of payment and the policies are still in force.

    Internal Revenue Service 1

1Internal Revenue Service, Internal Revenue Manual 4.42.6 Glossary, http://­www.irs.gov/­irm/­part4/­irm_04-042-006.html (last accessed Dec. 22, 2009).