Terminal Dividend
Additional policy dividend paid to a life insurance policyholder when a policy terminates. A mutual insurance company is owned by its policyholders and writes participating policies, which pay annual policy dividends to policyholders. (Some stock insurance companies pay dividends on some policies as well.) In addition to the annual dividend, many policies pay a terminal dividend when the policy terminates after a minimum period in force usually 10 to 20 years. This represents a realm to the policyholder of an equitable portion of the overall increase in the insurer's surplus over this period. Some companies pay this dividend no matter how a policy is terminated; others pay it only under certain conditions.
Popular Insurance Terms
Information generated by the medical information bureau (MIB) and made available to member companies concerning medical information of applicants for life and health insurance. Member ...
Company not licensed by a particular state to sell and service insurance policies within that state. ...
Latin phrase meaning "beyond power or authority" describing an act by a corporation that exceeds its legal powers. For example, corporations do not have the authority to engage in the ...
Approved or accepted policy for a particular type of risk. The only type of risk covered by a standard form mandated by law is the fire policy. In 1886, New York adopted a standard fire ...
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Measurement of the response of the cash flow of an insurance company to various interest rate scenarios; for example, how rising interest rates will affect the number of life insurance ...
Acquisition and employment of assets in order to maximize the return on these assets through: establishment of financial planning objectives; development of financial plans by which these ...
Additional amount of surplus generated by an additional amount of capital to be included in book value surplus. This additional surplus is necessary to act as a supplement to the statutory ...
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