Mid-Term Endorsement — Additional Premium
Collecting additional premium when a policyholder increases their sum insured or adds a risk mid-term.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Premium Receivable (Endorsement) | Asset (+) | 400.00 | - |
| Written Premium — Endorsement (Additional) | Revenue (+) | - | 400.00 |
💡 Accountant's Note
Mid-term endorsements adjust the policy. Additional premiums are written pro-rata for the remaining policy period and deferred using the UPR mechanism.
Practitioner & Systems Framework
💻 ERP Architecture
Mid-term endorsements are processed in the policy admin system, which automatically calculates the additional premium on a pro-rata basis for the remaining days of the policy period. The endorsement generates a new billing item in the AR sub-ledger. The UPR is recalculated on the total premium (original plus endorsement) as at the endorsement effective date. The policy schedule is updated to reflect the revised cover details and is reissued to the policyholder.
⚠️ Audit Flags
Auditors confirm that endorsement premiums are correctly calculated on a pro-rata basis from the effective date of the change to the policy expiry date, not a full-year premium. Test that the UPR is updated to reflect the endorsement premium. Verify that the endorsement has an effective date that is on or after the date of the policyholder's request — backdated endorsements require underwriter approval. For material increases in sum insured, confirm that the underwriter's acceptance note is on file.
📄 Required Documentation
Policyholder's request for endorsement, underwriter's acceptance (for material changes), endorsement premium calculation, updated policy schedule, and billing confirmation for the additional premium.
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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.