What Is Premium to Net Asset Value? Premium to net asset value (NAV) is a pricing situation that occurs when the value of an exchange-traded investment fund is trading at a premium to its daily reported accounting NAV. Funds trading at a premium will have a higher price than their comparable NAV. A premium to
What Is Premium Income? Premium income can refer to the proceeds an investor earns from writing (selling) options contracts, or the revenue an insurer earns from payments from policyholders. In either case, premium income originates from selling risk protection to a buyer. Investors can write options for premium income through several strategies that reduce their
What Is a Premium Put Convertible? A premium put convertible is a type of bond that combines the features of put bonds with the attributes of convertible bonds. Like a put bond, a premium put convertible can be redeemed for cash at the discretion of the bondholder. Like a convertible bond, a premium put convertible
Premium to surplus ratio is net premiums written divided by policyholder surplus. Policyholder surplus is the difference between an insurance company’s assets and its liabilities. The premium to surplus ratio is used to measure the capacity of an insurance company to underwrite new policies. Breaking Down Premium to Surplus Ratio Analysts may look at two formats of
What Is Prepackaged Bankruptcy? A prepackaged bankruptcy is a plan for financial reorganization that a company prepares in cooperation with its creditors that will take effect once the company enters Chapter 11. The aim of a prepackaged bankruptcy—which must be voted on by shareholders before the company files its petition for bankruptcy—is to save expenses
What is a Prepaid Cards Processor? A prepaid cards processor is a company that processes transactions for prepaid payment cards. Prepaid card processors are responsible for processing transactions for prepaid credit or debit cards, gift cards, payroll cards, and other payment cards that are considered secured by the front-loading of money. Key Takeaways A prepaid cards processor
What Is a Prepaid Expense? A prepaid expense is an expense that has been paid for in advance but not yet incurred. In business, a prepaid expense is recorded as an asset on the balance sheet that results from a business making advanced payments for goods or services to be received in the future. Prepaid
What Is a Prepaid Finance Charge? A prepaid finance charge is an upfront cost associated with a loan agreement or credit extension and must be paid in addition to standard loan repayment. These expenses may include fees, commissions, or administrative costs and are not part of the borrowed amount and are prepaid by the borrower
What Is Prepaid Insurance? The term prepaid insurance refers to payments that are made by individuals and businesses to their insurers in advance for insurance services or coverage. Premiums are normally paid a full year in advance, but in some cases, they may cover more than 12 months. When they aren’t used up or expired
What Is Prepaid Interest? Prepaid interest is the interest that a debtor pays before the first scheduled debt repayment. For taxation purposes, most kinds of prepaid interest are expensed over the life of the loan. For mortgage loans, prepaid interest can also be the interim interest that accrues from the settlement day to the beginning
