Disability Buy-out Insurance
Definition of "Disability buy-out insurance"
Buy-sell agreements found in partnerships, sole proprietorships, and close corporations. Either the business entity or the surviving members of the business agree to buy out the interest of a disabled member according to a predetermined formula funded through insurance. Disability buy-out insurance can be more important to a business than death buy-out insurance because the chances of becoming disabled are 7 to 10 times greater than death, depending on the age of the individual. The mechanisms available for the disability buy-out are the same as those found under business life and health insurance.
Popular Insurance Terms
Apparent agreement that is not a valid contract. ...
Plan to which contributions are not being made, but which has not been formally terminated. The freezing of a keogh plan (hr-10) may occur in the following circumstances: self-employed ...
Mortality table that reflects irregularities from age to age due to chance fluctuations in the sequence of the rates of mortality. The rates of death as reflected by the mortality table in ...
Amount expressed as a liability on the insurance company's balance sheet for benefits owed to policy owners. These reserves must be maintained according to strict actuarial formulas as they ...
Group coverage for members of a fraternal association, usually on a nonprofit basis. ...
Same as term Adjuster: individual employed by a property and casualty insurance company to settle on its behalf claims brought by insureds. The adjuster evaluates the merits of each claim ...
Rights of employees who leave an employer with a qualified plan to withdraw their accumulated benefits. With a contributory plan, employees have immediate rights to their own contributions, ...
Performance of a deed or function. Certain acts are prohibited from coverage in insurance. For example, if the insured commits a felony, the insured's beneficiary cannot collect under the ...
Actuarial equivalent method of calculating the premium rate through the development of the following equation: probability that the event insured against occurs x face amount of policy x ...
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