Premium Deficiency Reserve

Definition of "Premium deficiency reserve"

Vicki  Crunk Cain real estate agent

Written by

Vicki Crunk Cainelite badge icon

Buddy Tankersley Realty & Auction

Supplementary life insurance reserve required by state regulators when the gross premium is lower than the valuation premium. Some life insurers are able to charge policyholders a premium that is lower than required by the reserve valuation system they use. This may be because mortality tables are outdated and their own experience reflects different loss statistics. But if the insurer charges a premium lower than that dictated in the calculation of policy reserves, it must set up a deficiency reserve for the difference.

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

Health insurance plan where a group of physicians and dentists provide medical services to a group of individuals for a predetermined fee. It is a basic type of HEALTH MAINTENANCE ...

Sale of life insurance policies through vending machines. This method of distribution is generally limited to travel accident insurance, supplemental health or disability policies, or life ...

Portion of the federal tax code that determines which organizations are exempt from federal income taxation. These are generally nonprofit corporations, funds, and foundations for ...

Term describing illness, sickness, or disability incurred by the insured such that the insured is restricted to his or her home, a hospital, or a nursing home. Many health insurance ...

Five-year nonrenewable term life insurance policy for veterans who were covered by servicemens group life insurance (SEGLI) while on active duty in the U.S. uniformed forces. At the end of ...

Individual who is legally responsible for taking care of another individual (s) who is deemed to be incapable of managing his/her own affairs. For example, children under the age of ...

Failure to act with the legally required degree of care for others, resulting in harm to them. ...

Method of payment of an insurance premium that allows an insured to regulate the amount and frequency of the premium payments in accordance with cash flow over a stipulated period of time. ...

Allocation of monetary resources to equities. ...

Popular Insurance Questions