'premium' originates from Latin, specifically the word 'praemium,' where 'prae-' meant 'before' and 'emere' meant 'to take.'

'praemium' transformed into the Old French word 'prémium,' and eventually became the modern English word 'premium' through Middle English.

Initially, it meant 'reward or prize,' but over time it evolved into its current meanings related to insurance and quality.