What is Direct Premium?
Direct Premium The total amount of insurance premiums received directly by an insurer from policyholders, excluding premiums assumed through reinsurance or ceded to reinsurers.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Direct Premium” Used in Practice?
Direct premium written is reported separately from reinsurance in financial statements to show the insurer’s primary business volume.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Direct Premium?
The total amount of insurance premiums received directly by an insurer from policyholders, excluding premiums assumed through reinsurance or ceded to reinsurers.
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