The amounts charged the insureds (the policyholders) for insurance coverage are called:

Question

Options

• Awritten premium
• Bdirect written premium
• Ctotal premium
• Ddefined premium

• A
  80% (37)
• B
  7% (3)
• C
  11% (5)
• D
  2% (1)

Explanation

Written premium refers to the total amounts charged to policyholders for insurance coverage during a given period, making option A correct - it's the standard industry term for what insureds pay for their policies.

Why the distractors are wrong:

• B. Direct written premium is a more specific term used to distinguish premiums written directly by an insurer (not through reinsurance), so it's not the general term for what's charged to policyholders.
• C. Total premium is not a standard insurance accounting term - it's informal and not used in regulatory or actuarial contexts.
• D. Defined premium is not a recognized insurance industry term at all; it may be confused with "defined benefit" from retirement plan terminology.

Memory tip: Think of "written" as the act of writing (issuing) a policy - the written premium is what gets written onto the policy contract as the charge to the insured. If you see "direct written premium," remember the word "direct" signals it's excluding reinsurance, which is a narrower concept.

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