Advanced Premium Deposit Law and Legal Definition

Advanced premium deposit is a feature of a life insurance in which annual premiums are paid in advance at a discount. The interest earned on such advance premium deposit can be used to reduce the cost of the premium and life insurance premium will be automatically paid from that account. In short, it is the premium paid before the due date. For instance, in case of a premium that is due on March 1, 2007, if the insured pay the premium amount on January 1, 2007, such payment is called the advance premium amount. /p>