Enter the current return ($), the expected risk free return ($), and the invested amount ($) into the Return on Premium Calculator. The calculator will evaluate and display the Return on Premium. Return on Premium Formula The following formula is used to calculate the Return on Premium. ROP = (CR – ERFR) / P *100 • Where ROP is the Return on Premium (%) • CR is the current return ($)
• ERFR is the expected risk free return ($) • P is the invested amount ($)

How to Calculate Return on Premium?

The following example problems outline how to calculate Return on Premium.

Example Problem #1

1. First, determine the current return ($). • The current return ($) is calculated to be : 4,000.
2. Next, determine the expected risk free return ($). • The expected risk free return ($) is measured to be: 1,000.
3. Next, determine the invested amount ($). • The invested amount ($) is found to be: 20,000.
4. Finally, calculate the Return on Premium using the formula above:

ROP = (CR – ERFR) / P *100

The values given above are inserted into the equation below and the solution is calculated:

ROP = (4,000 – 1,000) / 20,000 *100 = 15 (%)

Example Problem #2

The variables needed for this problem are provided below:

current return ($) = 555 expected risk free return ($) = 140

invested amount (\$) = 1500

This example problem is a test of your knowledge on the subject. Use the calculator above to check your answer.

ROP = (CR – ERFR) / P *100 = (%)