What does cash on delivery indicate in premium collection?

What does cash on delivery indicate in premium collection?

• A. Delivery Receipt
• B. Cash On Delivery
• C. Accumulate
• D. Mode

Answer: (B)

Cash on delivery describes when the premium is paid—at the moment the policy is delivered. This premium collection method means the insurer or agent collects the payment (cash, check, etc.) when handing over the policy documents, rather than collecting it in advance or in installments. It also typically means the policy goes into effect only after the payment is received. The other options don’t describe how or when the premium is paid: a delivery receipt is just proof of delivery, accumulate isn’t a payment method, and mode is too generic.

Cash on delivery describes when the premium is paid—at the moment the policy is delivered. This premium collection method means the insurer or agent collects the payment (cash, check, etc.) when handing over the policy documents, rather than collecting it in advance or in installments. It also typically means the policy goes into effect only after the payment is received. The other options don’t describe how or when the premium is paid: a delivery receipt is just proof of delivery, accumulate isn’t a payment method, and mode is too generic.