Charitable Remainder Trust (crt)
Trust to which a donor transfers assets and that distributes income to finance a predetermined situation. After the trust expires, any remaining assets are donated to the qualified charity that was previously designated as the remainder beneficiary (beneficiary of trust). In the year of transfer, the donor receives a tax deduction for the future value of the assets that were transferred to the trust. Thus, under this type of trust, the donor (person who creates the trust) simply makes an irrevocable transfer of an asset (s) to a trustee. According to the trust agreement, the trustee must:
- invest the asset contributed to the trust;
- pay a predetermined annual income to the donor and/or another designated beneficiary for life or stipulated number of years;
- distribute the asset (s) to the charity, either when the donor dies or when a specific designated income beneficiary dies.
Popular Insurance Terms
Net profit of a business, less dividends. Reinvestment of retained earnings enables an insurance company to write more business from a stronger capital base. Contributions to retained ...
Death benefit option in which a beneficiary of a life insurance policy receives the death benefit as a single sum payment instead of installments. ...
In some states, principle of tort law providing that in the event of an accident each party's negligence is based on that party's contribution to the accident. For example, if in an auto ...
Selection of restricted random samples in order to obtain a more accurate estimate of the expected loss (mean) than could be obtained by the selection of completely RANDOM SAMPLES. For ...
Coverage on an all risks basis for loss due to theft or mysterious disappearance of personal property; damage to premises and property within resulting from theft; and vandalism and ...
Information needed for underwriting a life insurance policy, such as an applicant's age, weight, height, and build; personal and family health record; occupation; and personal habits. These ...
State that increases the probability of a loss. For example, storage of flammable material next to a furnace in one's home increases the hazard with the knowledge of an insured, and is ...
request by an insured for indemnification by an insurance company for loss incurred from an insured peril. ...
Analysis of uncertainty of financial loss. This classification can be according to whether a risk is fundamental, particular, pure, speculative, dynamic, or static. In life insurance the ...
Have a question or comment?
We're here to help.