What is the most common type of premium receipt?

The most common type of premium receipt is the conditional receipt. This receipt indicates that the insurance company will provide coverage, but the coverage is contingent upon certain conditions being met, typically including the underwriting process and the acceptance of the application.

When an applicant pays their premium and receives a conditional receipt, it suggests that the policy will become effective once the application is approved and if the insured is found to be insurable based on the insurer's standards. This practice allows the insured to have some level of risk protection immediately, rather than waiting for the final processing of their application.

The conditional receipt serves to both inform the applicant of the temporary coverage and protect the insurance company by holding them to the terms of coverage until they complete their underwriting assessment. In contrast, other types of receipts, such as non-conditional, full payment, or partial payment receipts, may represent different conditions regarding the effectiveness of coverage or the amount remitted. These receipts are less standard and typically do not provide the same immediate assurance of coverage that a conditional receipt does.