Internal Rate Of Return

Definition of "Internal rate of return"

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Cherry Creek Properties LLC

Method used to determine the policyholder's return on premiums paid into a life insurance policy. This method is illustrated in two ways:

  1. .Surrender of Policy Approach calculation of the interest rate required for the accumulated value of the total premiums paid(minus any DIVIDENDS) into the policy at a given time to equal the CASH SURRENDER VALUE of the policy at that time;
  2. DEATH BENEFIT Paid Approach calculation of the interest rate required for the accumulated value of the total premiums paid(minus any dividends) into the policy at a given time to equal the death benefit of the policy at that time.

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