Benefit Allocation Method
Method of funding a pension plan under which a single premium payment is made to fund a single unit of benefit for one year of recognized service with the employer. For example, if the employee earned an $85 unit of benefit for year X of recognized service to begin at age 60, a single premium deferred annuity would be purchased for that employee's account. Each year this procedure would be repeated as additional single premium deferred annuities would be purchased for each year of recognized service. At the time of retirement, the annuities so purchased would be combined to provide a monthly income benefit for the employee.
Popular Insurance Terms
Judgment decision by the insurance agent concerning whether or not to submit an application. The decision is based on the agent's familiarity with the insurance company's underwriting ...
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Measure of the sensitivity of the insurance company's liability to changing policy surrender distributions. ...
Means of distribution that uses general agents rather than branch offices to sell life and health insurance. ...
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Representation of ownership rights such as stocks. ...
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