# Monthly Instalment Calculations

It is possible to set up monthly instalment payments both by card and by direct debit. The way these instalments are calculated are set out below:

## Monthly Instalments when NO DEPOSIT is paid

When no deposit is being paid on the account the monthly installments are calculated as follows:

**Monthly Amount** = **Premium** DIVIDED BY (**Policy Term Length in Months** MINUS 1)

For example; if the Premium is £1,100 and the policy runs for 1 year. Then the monthly amount is calculated as follows:

£1,100/(12 – 1) = £100 Monthly

## Monthly Instalments when a Deposit is paid

In this instance where a deposit has been paid the instalments are calculated differently the formula used is below:

**Monthly Amount** = (**Premium** MINUS **Deposit**) DIVIDED BY (**Policy Term Length in Months** MINUS 1)

For example; if the premium is £2,400 and the policy runs for 1 year with a deposit required of £200. The monthly amount is calculated as follows:

(£2400 - £200)/(12-1) = £200 Monthly

## See Also:

Managing Direct Debit Schedules

Auditing Changes to Cases including Direct Debit Schedules