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
Act that mandates that employers who have at least 26 employees must provide a terminating employee and family members, if residents of employee's household, with health insurance coverage ...
Federal statute that permits the self-employed a 100% tax deduction for the family health care expenses to include health insurance premiums, disability INCOME insurance premiums, and ...
Nonforfeiture option that uses the cash value of an ordinary life policy as a single premium to purchase term life insurance in the amount of the original policy. The length of the term ...
Membership organization primarily of medium and small life and health insurance companies. It represents the views and interests of smaller companies in various political forums. ...
Act that requires the Department of Labor (DOL) to have a formal program to educate the public about the importance of saving for retirement. The DOL is also required to educate the public ...
Break in commercial activities due to the occurrence of a peril. Coverage against business interruption by various named perils can be obtained through insurance. ...
Technique designed to permit the exchange of a life insurance policy that has an outstanding loan charged against it for another life insurance policy on a tax-free basis. The procedure is ...
Group of plans (to include section 401(k) plans and section 403(b) plans) that permit in-service withdrawals to fund a college education if a hardship exists. ...
Coverage for malpractice suits resulting from professional acts and/or omissions of morticians. ...
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