What is Debit note and credit note and how affect in insurance industry?

Debt and credit notes are an essential account's transaction in insurance accounts.

The initial one is a credit note which prepares and issues together and along with the insurance policy and be attached to it to count for the amount of premium that to be charged from the insured .

The insurance policy is always an Underwriting Department task which issues the insurance policy and then pass a copy of the debit note to the accounts department to follow premium payment and other further accounts processing.

While the credit note issued by the same underwriter but to count for claims payment and then passed to accounts department to effects payment of claim to the insured and then to take other further accounts transaction process.

Also debt and credit notes may be issued by the Underwriting Department during the course of the insurance policy to count for additional or refund premium respectively.

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Debit notes are generated by one entity to another to reflect amounts due for the entity generating the debit note,

On the opposite, credit notes are generated by one entity to another to reflect amounts due for the entity receiving the credit note,

Entity requesting the fund will issue a debit note,

Entity sending the funds will issue a credit note,

and all the above is done by such entities (insurer , insured , brokers and reinsurers) to reflect financial transactions in their statements of accounts making adjustments on the statments balances and oustandings through the debit / credit transactions.