What is a Return Premium Endorsement?

An endorsement is a form that can change or add to an insurance policy. A return premium endorsement is filed if there is a change to the policy that decreases the coverage. It is an endorsement for the amount due the insured if the actual cost of a policy is less than what the insured has previously paid. This can happen if the limits are reduced, the estimated exposure at inception is greater than the audited exposure, or the policy is canceled.

Understanding Return Premium Endorsements

For example, an insured has a Business Auto policy written through the non-admitted market and wants to remove a driver from their policy. A Return Premium Endorsement would be filed to amend the original policy to remove the driver. An endorsement would reflect the change in coverage and decreased premium.

Tips for Managing Insurance Endorsements

The process for filing insurance endorsements varies from state to state, as each state maintains its own requirements. Since filing requirements for endorsements vary so much, it is important to verify what information will be required in the state in which you are filing the endorsement.

Most endorsements will include:

  • Policy number
  • Name of Insured
  • Endorsement Type
  • Effective Date of Change
  • Premium Amounts (Additional or Return)
  • Surplus Lines Tax (Additional or Return)
  • State Stamping Fees (Additional or Return)

There’s a lot to keep track of when filing insurance endorsements, and for nearly every “rule,” there seems to be a state with an exception. With the many nuances, managing insurance endorsements can seem like an overwhelming task.

InsCipher offers products and services to simplify the surplus lines filing and reporting process, including managing endorsements. Our flagship product, InsCipher Connect™, offers intuitive features for managing endorsements without the headache or risk of non-compliance and late fees.

Related Terms

Additional Endorsement

Audit Endorsement

Cancellation Endorsement

Endorsement

Reinstatement Endorsement

Zero Premium Endorsement

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