What is ‘Cancelable Insurance’
This is insurance that may be canceled, at any time, by the insured party or by the insurance company. Aside from life insurance, most insurance policies can easily be. If the insurer cancels the policy, it must first give notice and must also refund prepaid premium on a pro rata basis.
Explaining ‘Cancelable Insurance’
Before canceling an insurance policy, the insured party must make sure that he or she has replacement insurance coverage that is already confirmed. If there is no replacement coverage, the insured party can go completely uncovered for a period of time. One good reason for making certain of replacement coverage is that the insured party could face a situation in which certain medical conditions that developed during the prior health insurance coverage are excluded from coverage under the new insurance as “preexisting conditions.” This is why it is essential to thoroughly research a new policy before the old one is canceled.
Further Reading
- Trade credit insurance: operational value and contract choice – pubsonline.informs.org [PDF]
- … Incurred Loss to Current Expected Credit Loss (CECL): A Forensic Analysis of the Allowance for Loan Losses in Unconditionally Cancelable Credit Card Portfolios – papers.ssrn.com [PDF]
- Home equity insurance – link.springer.com [PDF]
- The market pricing of disability income insurance for individuals – www.sciencedirect.com [PDF]
- Valuation Of The Embedded Option In A Non-Cancelable Lease: Theory And Application – clutejournals.com [PDF]
- Case of trade credit insurance – books.google.com [PDF]
- The investment opportunity set and corporate financing, dividend, and compensation policies – www.sciencedirect.com [PDF]
- Financing the newsvendor: raising the loan limit by insurance contract – link.springer.com [PDF]
