How to record return reinsurance commission
Adjusting for the reversal of reinsurance brokerage income due to a policy cancellation or premium reduction.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Reinsurance Brokerage Revenue | Revenue | 300.00 | - |
| Reinsurance Premium Payable | Liability | - | 300.00 |
💡 Accountant's Note
If a reinsurance contract is cancelled mid-term, the broker must return the unearned portion of their brokerage fee to the reinsurer, usually as a credit toward the next premium settlement.
Practitioner & Systems Framework
💻 ERP Architecture
Triggered automatically when a return premium bordereau is processed.
⚠️ Audit Flags
Large manual adjustments to brokerage revenue accounts.
📄 Required Documentation
Endorsement or cancellation slip from the reinsurer.
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Discussion & Community Questions
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