Short Rate Cancellation Penalty Table Lookup

Read actual elapsed days in caller verified lower-inclusive short-rate earned-premium table, then subtract independent fee; no universal short-rate penalty or pro-rata/minimum-earned substitution.

Description

Short-rate cancellation uses a verified earned-premium schedule rather than straight elapsed-time proration.

Short-rate cancellation uses a verified earned-premium schedule rather than straight elapsed-time proration. An independent fee reduces the return.^[1]

The returned values include Caller short rate earned premium minor, Caller short rate return premium minor. The How section below explains the calculation, input rules and interpretation.

When to use Short Rate Cancellation Penalty Table Lookup

Use Short Rate Cancellation Penalty Table Lookup when you need to evaluate the supplied records under the calculation and evidence rules below. No universal short-rate table, pro-rata substitution or cancellation entitlement is supplied.

Prepare the observed policy, claim or quote evidence and independently verified policy tables. Monetary fields use integer minor units in one currency: for a currency with 100 minor units per major unit, enter 12345 for 123.45. One basis point is 0.01 percentage points, so 10000 basis points represents 100%.

How to use Short Rate Cancellation Penalty Table Lookup and understand its results

Prepare the observed policy, claim or quote evidence and independently verified policy tables. Monetary fields use integer minor units in one currency: for a currency with 100 minor units per major unit, enter 12345 for 123.45. One basis point is 0.01 percentage points, so 10000 basis points represents 100%.
Enter observedElapsedTermDays, callerCancellationDayLowerEdges, callerVerifiedEarnedShortRateBasisPoints, callerWrittenPremiumMinor, callerCancellationFeeMinor using the field table and calculation rules, then run the tool.
Read callerShortRateEarnedPremiumMinor, callerShortRateReturnPremiumMinor. The explanation below defines the units, signs, ordering and any flags or placeholder values.
If the tool reports an input issue, correct the values and run it again. Apply the stated assumptions when interpreting a successfully returned result.

Input field	Meaning	Value type; see rules below	Requirement
observedElapsedTermDays	Observed elapsed term days	number	Required
callerCancellationDayLowerEdges	Caller cancellation day lower edges	list of number	Required
callerVerifiedEarnedShortRateBasisPoints	Caller verified earned short rate basis points	list of number	Required
callerWrittenPremiumMinor	Caller written premium minor	number	Required
callerCancellationFeeMinor	Caller cancellation fee minor	number	Required

Enter integer elapsed days 0–3660, aligned nonempty finite strictly increasing day edges beginning at zero, integer earned basis points 0–10000 and integer written/fee money 0–10¹² each. Select the last lower-inclusive tier, round earned money and clip return at zero.

earned=roundMinor(written×tierBasisPoints/10000); return=max(0,written−earned−fee)

Units, indexing, boundary conditions and exceptional cases are defined in the calculation rules above.

Output field	Meaning	Value type
callerShortRateEarnedPremiumMinor	Caller short rate earned premium minor	number
callerShortRateReturnPremiumMinor	Caller short rate return premium minor	number

json

{
  "input": {
    "observedElapsedTermDays": 15,
    "callerCancellationDayLowerEdges": [
      0,
      10,
      20
    ],
    "callerVerifiedEarnedShortRateBasisPoints": [
      1000,
      3000,
      5000
    ],
    "callerWrittenPremiumMinor": 10000,
    "callerCancellationFeeMinor": 100
  },
  "output": {
    "callerShortRateEarnedPremiumMinor": 3000,
    "callerShortRateReturnPremiumMinor": 6900
  }
}

Limitations and assumptions

No universal short-rate table, pro-rata substitution or cancellation entitlement is supplied.

Numeric inputs, where present, must be finite. Follow the calculation-specific rules for overflow, underflow and exceptional cases. Numeric lists are limited to 10,000 entries; string lists to 128 strings of at most 128 characters each. The rules above may impose smaller limits. Missing required fields, extra fields, wrong value types and violations of the calculation rules are input errors.

Alternative or Complementary methods

Use Minimum Earned Premium Cancellation Formula Calculator: Minimum-earned cancellation retains the greater of elapsed-time premium and a caller floor. Nonrefundable fees reduce the remaining refund. For a complementary task, use Mid Term Endorsement Proration Return Premium Calculator: A mid-term endorsement prorates the difference between full-term premiums over remaining civil days. A half-open term excludes its end date.

References

Short Rate Cancellation Penalty Table Lookup — tool.io

Similar or alternative tools

Minimum Earned Premium Cancellation Formula Calculator
Minimum-earned cancellation retains the greater of elapsed-time premium and a caller floor. Nonrefundable fees reduce the remaining refund.
Mid Term Endorsement Proration Return Premium Calculator
A mid-term endorsement prorates the difference between full-term premiums over remaining civil days. A half-open term excludes its end date.