Accrued Benefit Cost Method
Definition of "Accrued benefit cost method"
Actuarial method of crediting retirement benefits earned and the costs associated with these earned retirement benefits. An increment (unit) of benefit is credited for each year of recognized service that an employee has earned. Then the present value of these benefits (including the employee's life expectancy) is calculated and assigned to the year earned. The benefit earned by the employee can take the form of a flat dollar amount or a percentage of compensation. For example, this may work out to 11/2% of an employee's compensation being credited to the employee's account for each year of recognized service.
Popular Insurance Terms
Gain that occurs when the move in the underlying asset in one direction is similar to the loss when the underlying asset moves in the opposite direction. For example, if a stock goes up by ...
Instrument that guarantees compliance with various city, county, and state laws that govern the issuance of a particular license to conduct business. ...
Difference between the actuarial equivalent (rate) and the often lower rate actually charged to insure a risk. ...
recipient. insurance company that receives a premium payment from a payer. insured or beneficiary who receives a loss or benefit payment from an insurer. ...
Maximum limit of liability of an insurance company for a particular claim or kind of loss that is applicable in general to all such claims or losses. This maximum limit of liability is ...
In insurance, debit agents list of total premiums to be collected. This also applies to the geographical area in which an agent collects the premiums. ...
Single insurance policy for only one kind of property at only one location of an insured. For example, property insurance on a rare piano in the insured's home would cover only that piano, ...
Policy permitting an insured to choose desired coverages. These policies are important for items with relatively low limits of coverage under standard property insurance forms. For example, ...
Excess of loss reinsurance written on a facultative reinsurance basis to provide cover for a particular PRIMARY INSURANCE policy. ...
Have a question or comment?
We're here to help.