Life Insurance Cost
Amount paid to an insurer. Determination of the actual cost (not the price paid) of a life insurance policy has been widely discussed for many years in life insurance and consumer circles. The traditional or net cost method (that adds a policy's premiums, and subtracts dividends, if any, and cash value) does not consider the time value of money. The LINTON yield method, a theoretical approach, attempted to remedy this by comparing a cash value policy with a combination of decreasing term insurance and the yield of a side fund of bonds and other investments. Other methods have been proposed. At present many states require prospective insureds to be given interest-adjusted cost figures that do take into consideration the time value of money. This method is not altogether practical for INTEREST SENSITIVE POLICIES, but it is generally felt that present work toward a new approach will eventually result in a useful means of comparing the costs of these policies.
Popular Insurance Terms
Coverage for dispensers of alcoholic beverages against suits arising out of bodily injury and/or property damage caused by its customers to a third party. Establishments covered include ...
Flat dollar amount added to arrive (premium rate per $1000 of face amount x face amount) at the premium. ...
Limited pay whole life policy under which all premium payments have been made. For example, a 20 pay policy is completely paid for after 20 payments; no future premiums have to be made, and ...
Coverage on an all risks basis through an endorsement to a business property insurance policy in which each sign is specifically scheduled, subject to the exclusions of wear and tear, and ...
Type of excess of loss reinsurance in which the insurance company (cedent) cedes its risk of loss on incurred but not reported losses (IBNR) and previously reported losses. ...
Insurance policy sold by nonadmitted insurer. ...
Associated insurers that are under common stock ownership or interlocking directorates. Such an arrangement makes it easier to exchange insurance products for sale to the consumer, reduces ...
Insurance transactions conducted across national boundaries. Such transactions occur when the insurance company sells insurance outside the country of the company's domicile. ...
Authority derived from an agent's contract with an insurance company. ...
Have a question or comment?
We're here to help.