How to book endorsement premium changes
Records the additional premium and associated commission resulting from a mid-term policy endorsement.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Client Receivable | Asset | 1,200.00 | - |
| Premiums Payable to Carrier | Liability | - | 1,020.00 |
| Commission Income - Endorsements | Revenue | - | 180.00 |
💡 Accountant's Note
When a policy is modified mid-term (endorsement), the additional premium is billed to the client, the net amount is owed to the carrier, and the broker recognizes additional commission.
Practitioner & Systems Framework
💻 ERP Architecture
Ensure the agency management system (AMS) links the endorsement to the original policy shell for reporting.
⚠️ Audit Flags
Discrepancies between endorsement effective dates and accounting period recognition.
📄 Required Documentation
Signed endorsement request and carrier confirmation of premium change.
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Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.
Related Journal Entries
Insurance Broking & MGA
Insurance Commission — Recognized at Policy Inception/Renewal (Point-in-Time)
Insurance Broking & MGA
Contingent Commission / Profit Sharing — Variable Consideration Constrained Until Carrier Determination
Insurance Broking & MGA
Premium Trust Account — Client Premium Received (Not Broker Revenue — Fiduciary Obligation)
Discussion & Community Questions
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