This can result in a partial return premium which can be calculated in different ways depending on the method specified in the policy.
[2] A non-penalty method of calculating the return premium of a canceled policy.
A return premium factor is calculated by taking the number of days remaining in the policy period divided by the number of total days of the policy.
[3] A penalty method of calculating the return premium[4] often used when the policy is canceled at the insured's request.
It uses a table of factors that results in penalties that can be lower or higher than short rate (90% pro rata) depending upon the date of cancellation.