Premium Law & Legal Definition
In legal terms, a premium usually refers to a payment paid by the insured to the insurer for providing insurance policy. Insurance premiums may be made either in a lump sum or by installments. In the insurance industry, each individual pays a premium into a pool, from which losses are paid out. The premium is not returnable if a loss is not suffered, in that case the payment is for "peace of mind". Thus, when a loss is suffered, the loss is spread to the people contributing to the pool. To ensure these pools are properly managed and adequately funded, the government and the courts heavily regulate the insurance industry. An earned premium is the portion of a premium that represents coverage already provided uder a policy period already passed, whereas an unearned premium is the portion of a premium representing the unexpired part of the policy period.
A premium may also refer to an extra payment for an act, option or priority. In corporate transactions, a premium may be paid on top of the market value of a share of a stock in an attempt to prevent a hostile takeover. In another example, The Immigration and Naturalization Service (INS) offers expedited application processing for an extra fee.
Legal Definitions
Search Definitions
Get a Term Defined
- Request a legal definition! Submit a term you need defined.
- » Request Legal Definition
Submit a Definition
- Submit a Definition Help us build our database. Free listings for attorneys.
- » Submit a Definition
Help Build USLegal
- Join our Team and help build USLegal. Many opportunities for participation so Join our Network.
Build USLegal
Read a Law Digest
- Need to read the law or find an answer to a legal question? Visit our Law Digest for the largest selection of law digests and answers available.
Go to Law Digest
Form Packages
- Select from our most popular legal form packages.
- » Bankruptcy
- » Contract for Deed
- » Divorce
- » Employment Packages
- » Home Sales
- » Incorporation
- » LLC Formation
- » Landlord Tenant
- » Mutual Wills
- » Name Change
- » Personal Planning
- » Partnerships
- » View All Packages
Legal Life
- Organize your legal life today! View our free online guide to creating a Life Documents File and related products.
- » Life Documents File
- » Personal Planning Package
- » Life Documents Packages
- » New Parents
- » Newlyweds
- » Baby Boomers
- » Military
- » Other
Form Drafting
- Can′t find the form you need, or need a form we offer revised for your situation? Submit your request and our attorneys will review the request and let you know if the form can be provided.
Submit a drafting request...
