What does this line mean? (Auto Insurance Policy)

[akravator]

I'm looking at having an insurance policy cancelled so it can be switched to a more reasonable one.

There is a section of the policy titled 'Cancellation Request' and the line that has me confused reads as follows:

"In return for the unearned portion of the premium, if any, this policy is cancelled. Any interim and renewal certificates are no longer valid"

What does this mean? "In return for the unearned portion of the premium"

Thanx in advance for any help

[rems]

I'm looking at having an insurance policy cancelled so it can be switched to a more reasonable one.

There is a section of the policy titled 'Cancellation Request' and the line that has no confused reads as follows:

"In return for the unearned portion of the premium, if any, this policy is cancelled. Any interim and renewal certificates are no longer valid"

What does this mean? "In return for the unearned portion of the premium"

Thanx in advance for any help

Basically you get back the premium which has not yet been earned when you cancel the policy. Earned means what portion of the premium that was exposed to the risk already (ie the amount of time the policy was inforce).
So say you cancel 3/4 into your policy (9 months). The unearned portion is the remaining 1/4 or 3 months worth.

[akravator]

Okay. I think I get it.

As an example. Say the policy costs $1200 per year.

3 months have elapsed where the policy was in effect. $300 taken away.

I elect to cancel the policy at this point.

I simply get to 'keep' the $900 for the 9 months that I have yet to be 'protected for'.

- - - Of course, this ignores some sort of a cancellation fee that likely exists- - -

[Edit]: Thanks rems and COSMIC5

[COSMIC5]

thats pretty much it..if you cancel mid term you will receive a lower return premium for any unearned amount owning.

Okay. I think I get it.

As an example. Say the policy costs $1200 per year.

3 months have elapsed where the policy was in effect. $300 taken away.

I elect to cancel the policy at this point.

I simply get to 'keep' the $900 for the 9 months that I have yet to be 'protected for'.

- - - Of course, this ignores some sort of a cancellation fee that likely exists- - -