What does premium mean?
Premium has two broad grammatical uses. As an adjective, it describes something of higher than standard quality, value, or price, as in premium seating, premium petrol, or a premium brand. In these contexts it often carries a suggestion of superiority, exclusivity, convenience, or luxury, although the word can refer simply to a price above the standard rate. As a noun, premium may mean an extra charge imposed on a transaction, a prize or reward, or a payment made to maintain insurance coverage. The phrase “at a premium” is especially established: something that is “at a premium” is scarce, in demand, or valued above its normal level. Premium is therefore useful for expressing both commercial status and financial value. Its meaning depends on context, but its common associations are higher cost, enhanced quality, reward, and payment.
Of higher than standard quality, value, or price; often used to describe an enhanced product, service, or tier.
"The hotel provides premium rooms with additional services."
Common in commercial, marketing, travel, and service contexts. It may imply luxury or exclusivity.
An amount paid in addition to the usual price, a reward or prize, or a regular payment for insurance. It can also refer to a price above the usual or face value.
"Customers pay a premium for weekend delivery."
The precise meaning is determined by context; “insurance premium” and “at a premium” are especially common established usages.
The plural is used for separate insurance payments, additional charges, rewards, or prices above their usual value.
"The insurer raised its premiums for the coming year."
Premium began life as a prize: its Latin ancestor, praemium, meant a reward or an amount paid for something valuable.
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Where does premium come from?
English borrowed premium from Latin praemium, meaning “prize,” “reward,” or an amount paid or gained. Latin praemium developed from prae- and emere, “to buy,” reflecting its sense of a payment or something obtained by paying. The same Latin source underlies English prize, while related forms such as premial and premiate preserve the older idea of reward or prize.
Related word forms
How premium is actually used
As an adjective, premium is common in commercial and marketing language and can suggest luxury or higher quality. As a noun, it is especially common for insurance payments, additional charges, and rewards.
Easily confused with premium
Premium means higher than standard in quality, price, or value, whereas premier means first or most important, as in a premier league.