Which of the following is a cancellation procedure in which the premium returned to the insured is NOT in direct proportion to the number of days remaining in the policy period?

Insurance

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Which of the following is a cancellation procedure in which the premium returned to the insured is NOT in direct proportion to the number of days remaining in the policy period?

1. Flat rate

2. Proportional

3. Short rate

4. Pro rata

1. Flat rate

Answer: 3. Short rate

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