Glossary
Policy Term
The period during which a policy provides coverage, running from its effective date to its expiration date.
Most personal and commercial lines policies run six or twelve months. The term defines the window over which premium is earned, and it anchors every date-based calculation in an agency's books: pro-rata refunds, renewal timing, and commission earning.
Reconciliation depends on terms being recorded accurately. When a carrier statement references a policy by number alone, the term is what distinguishes this year's transaction from last year's — and mismatched terms are a common reason a line fails to auto-match and lands in the exception queue.
See also
- Effective Date — The date on which coverage under a policy or endorsement begins.
- Expiration Date — The date a policy's coverage ends unless it is renewed, extended, or replaced.
- Renewal Retention — The share of expiring policies or premium an agency keeps at renewal, the single clearest measure of book health.