Stock Appreciation Rights (sars)
Definition of "Stock appreciation rights (sars)"
Contractual rights to a stipulated percentage of the increase in the value of an insurance agency over a given future period of time. They are used to convey a percentage of the increase in the agency's value to a key employee without resulting in the owner (s) of the agency owning less than 50%. The advantages of such a stock transfer for the agency owner include the following:
- Noncompete agreements not further reinforced since the key employee does not receive benefits if an agreement is violated.
- The key employee is tied to the agency because that employee can become an equity owner without actually committing his or herown funds.
Popular Insurance Terms
Threatening act, physical and/or verbal, which causes a person to reasonably fear for life or safety. For example, if a boxing champion said he was going to hit someone, this would probably ...
Standard property/casualty insurance premium set by a state rating bureau. States have responsibility for regulating insurers and making certain that rates are reasonable. To this end, ...
Important means of preventing accidents and injuries. Insurers take corporate safety programs into account when rating workers compensation and other business insurance policies. ...
Time that has elapsed between when claims actually occurred and when claims are actually paid. ...
Model state law of the NAIC that stipulates that the contract owner must receive annual reports concerning the annuity unit values, the manner in which the variable benefits are calculated, ...
Gross yield minus total costs (expenses). ...
Policy clause that excludes coverage for loss of property if the cause of the loss cannot be identified. Mysterious disappearance is an exclusion in a standard inland marine insurance ...
Type of disability income insurance that provides income payments to the wage earner when income is interrupted or terminated because of illness, sickness, or accident and can continue to ...
Sample of n elements selected from a population of A? elements in such a way that the sample has essentially the same characteristics as the population. The random sample serves as the ...
Have a question or comment?
We're here to help.