Insurance proration

**Insurance proration**

Insurance proration refers to the process of adjusting an insurance premium or coverage amount on a proportional basis, typically when a policy starts or ends partway through a coverage period. This calculation ensures that the insured pays only for the portion of the policy term they are covered, rather than the entire term. Proration is commonly applied in scenarios such as mid-term policy cancellations, endorsements, or when adding or removing coverage. Understanding insurance proration helps policyholders manage costs accurately and avoid overpayment or gaps in coverage.