Unearned Premium Reserve


Unearned Premium Reserve

An account into which an insurer deposits unearned premiums, which are paid on insurance policies before they are due. For example, one may pay six months' worth of premiums in January instead of paying each month from January to June. Unearned premiums are listed as liabilities on an insurer's balance sheet and regulators thus require insurance companies to maintain reserves to refund these amounts if necessary.