Written premiums are the premiums registered on the books of an insurer or reinsurer at the time a policy is issued and paid for. Written premiums may include direct and assumed premiums written. Direct premiums written are the premiums written by the insurer's subsidiaries for all policies. Assumed premiums written are the premiums received from an authorized state mandated pool.
When an insurance company enters into a contract to provide insurance against a loss, the expected premiums are gross premiums. Usually, insurance companies purchase reinsurance to protect themselves against the risk of a loss above a certain threshold. When the cost of reinsurance is deducted from the expected premiums (gross premiums), the result is the net written premiums.
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