when you sign up for an insurance policy your insurer will charge you a premium this is the amount you pay for the policy policyholders may choose from several options for paying their insurance premiums some insurers allow the policyholder to pay the insurance premium in installments monthly or semi annually while others may require an upfront payment in full before any coverage starts 
the price of the premium depends on a variety of factors including there may be additional charges payable to the insurer on top of the premium including taxes or services fees auto insurancefor example in an auto insurance policy the likelihood of a claim being made against a teenage driver living in an urban area may be higher than a teenage driver in a suburban area in general the greater the risk associated the more expensive the insurance policy and thus the insurance premiums life insurancein the case of a life insurance policy the age at which you begin coverage will determine your premium amount along with other risk factors such as your current health the younger you are the lower your premiums will generally be conversely the older you get the more you pay in premiums to your insurance company high value policies will also carry a higher permium a few insurers may offer premium cash flow payment plans these plans allow the policyholder to pay the premium in small intervals some policyholders might also use premium financing to pay for expensive premiums but there is risk involved with this process 