Definition of "Lapse ratio"

Betty Latsonas real estate agent

Written by

Betty Latsonaselite badge icon

Keller Williams Experience Realty

Percentage of a life insurance company's policies in force at the beginning of the year that are no longer in force at the end of the year. This ratio is critical because it indicates the rate at which policies are going off the books and the resultant loss of earnings to the company.

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.
 

 

Popular Insurance Terms

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 ...

Tenant's modifications of leased space to fit his particular needs. Up to 10% of contents coverage inside the structure may be applied to insure against damage or destruction of ...

Same as term: Actuarial Science: branch of knowledge dealing with the mathematics of insurance, including probabilities. It is used in ensuring that risks are carefully evaluated, that ...

Association of life insurance companies focusing on legislation and public relations that may affect the life insurance business on federal, state, and local levels. Membership is composed ...

Insurance company that has the authority to assess or charge its policyholders for losses that the company is incurring. This company is sometimes called stipulated premium company or ...

Liability insurance coverage for claims arising from acts that occurred before the beginning of the policy period. Policies written on a claims made basis, such as malpractice liability ...

Interest earned on dividends from a participating life insurance policy left on deposit with the insurance company and subject to taxation. ...

Device that allows plan participants in employee stock ownership plan (ESOP) trust to reinvest the dividends into their section 401 (k) plan. Under the switchback approach, plan ...

Association formed to address the requirements of government risk pools. ...

Popular Insurance Questions