Premium Reconciliation Checklist

Talk to an Insurance Accounting Consultant See Pricing

This playbook standardizes the premium reconciliation process for insurance agencies, MGAs, wholesalers, program administrators, and carriers.

The objective is simple:

Every premium dollar should be traceable from policy issuance through customer payment, trust accounting, carrier settlement, and the General Ledger.

Recommended Frequency

Estimated Completion Time: 30–90 minutes per reconciliation cycle

Reconciliation Status Dashboard

ActivityComplete
Premium Transactions Reviewed
Customer Payments Applied
Carrier Statements Matched
Trust Accounting Verified
Carrier Payables Balanced
Commission Verified
General Ledger Balanced
Step 1

Premium Activity

Verify:

  • New business processed
  • Renewals processed
  • Endorsements processed
  • Cancellations processed
  • Return premium processed
  • Audit premium processed
  • Premium adjustments approved
Step 2

Customer Payments

Confirm:

  • Customer payments received
  • Cash applied correctly
  • Partial payments reviewed
  • EFT activity posted
  • ACH activity posted
  • Outstanding unapplied cash reviewed
Step 3

Carrier Statements

Review:

  • Carrier statement imported
  • Statement period verified
  • Missing policies investigated
  • Duplicate transactions reviewed
  • Carrier adjustments identified
Step 4

Trust Accounting

Verify:

  • Trust balance supports carrier obligations
  • Trust reconciliation complete
  • Trust variance investigated
  • Outstanding trust exceptions resolved
Step 5

Carrier Payables

Review:

  • Outstanding carrier balances
  • Settlement schedule
  • Pending settlements
  • Settlement approvals
  • Payment status
Step 6

Commission Validation

Verify:

  • Producer commissions
  • Broker commissions
  • MGA commissions
  • Commission adjustments
  • Manual overrides approved
Step 7

General Ledger

Confirm:

  • Premium balances agree
  • Trust balances agree
  • Carrier payables agree
  • Commission balances agree
  • Journal entries reviewed

Exception Review

Investigate immediately:

No reconciliation should be considered complete while unresolved exceptions remain.

Reconciliation Health Score

MetricTargetActual
Match Rate>99%
Unapplied CashMinimal
Settlement Accuracy100%
Trust Variance0
Open Exceptions0
Manual Adjustments

Controller Questions

Before approving reconciliation ask:

If the answer is no, reconciliation is not complete.

Common Reconciliation Problems

Review immediately if:

These usually indicate process problems-not accounting problems.

Best Practices

Successful finance organizations:

Deliverables

At completion, confirm:

Related Playbooks

Schedule a PremiumAccounting.ai workflow assessment to automate premium reconciliation, eliminate spreadsheets, and post validated accounting entries into QuickBooks, Sage Intacct, Xero, or Workday.

Talk to an Insurance Accounting Consultant See Pricing

Frequently Asked Questions

Operational reconciliation should occur continuously throughout the month, with formal reviews performed daily, weekly, and before month-end close.

To verify that premium transactions, customer payments, trust balances, carrier statements, commissions, settlements, and the General Ledger all agree.

Customer payments, unapplied cash, carrier statements, trust balances, and outstanding reconciliation exceptions.

Manual processes, spreadsheet dependency, timing differences, unapplied cash, commission adjustments, and settlement delays.

Yes. Every unexplained difference should be researched before financial statements or carrier settlements are finalized.

PremiumAccounting.ai serves as the insurance accounting subledger between your policy administration system and your General Ledger, automating premium reconciliation, trust accounting, carrier statement matching, commissions, settlements, and workflow approvals.