Short Rate Penalty Calculator

Calculate Short Rate Penalty (SRP)



Formula

The formula to calculate the Short Rate Penalty (SRP) is:

\[ \text{SRP} = \text{PRCF} \times \text{SRF} \]

Where:

What is Short Rate Penalty?

The Short Rate Penalty is a fee charged when an insurance policy is canceled before its expiration date. It is calculated by multiplying the pro-rate cancellation factor by the short rate.

Example Calculation

Let's assume the following values:

Using the formula to calculate the Short Rate Penalty:

\[ \text{SRP} = 0.8 \times 100 = 80 \]

The Short Rate Penalty is 80.