Quote Originally Posted by Vipul View Post
I have a query -
1- What is a prorata premium?
Prorata premium is the premium taken only for the short period; for which proposer is looking for cover.
2- Suppose I wanted to cover my car from 1 Feb'2010 to 31 July'2010, how the insurance company calculates prorata premium?
Period of cover 1 Feb'2010 to 31 July'2010
Suppose Annual Car Premium = 5000
Now prorata premium = 181 days at 5000/365 a day
= 181*5000/365
= 2479.45