1. What is Prorata Premium?
This is a premium based on the length of time the insurer was actually at risk. Usually it is used to describe the few days that fall within the month before payment of the premium started.

2. How is prorata premiul calculated?

The insurance company calculates the annual premium for adding the new car based on information such as the year, make, model of the car, garage location, vehicle cost and miles driven. After determining the annual premium, the insurance company charges the ABC Company the pro rata premium from August 24 to December 31.