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
Individual (s) entitled to receive the income generated by the trust. ...
Coverage for persons whose medical history includes serious illness such as heart disease or whose physical condition is such that they are rated below standard. A policy may specifically ...
Independent federal government organization authorized by the employee retirement income security act of 1974 (erisa) to administer the pension plan termination insurance program. Its ...
Resident patient of a medical installation. Previously, health insurance benefits were limited to in-patient care. Today health insurance policies provide an extensive list of out-patient ...
Property insurance coverage for only one of the parties having an insurable interest in that property. ...
To accumulate. For example, under one of the dividend options of a participating life insurance policy, dividends can accumulate at interest by leaving them with the insurance company; cash ...
Sum total of the annual effective rate of return earned by an owner of a bond if that bond is held until its maturity date. This effective return includes the current income generated by ...
Costs associated with renewal commissions as a percentage of the renewal premiums, and the servicing charges for previously issued insurance policies. ...
Gain when the underlying asset that moves in one direction is significantly different from the loss when the underlying asset moves in the opposite direction; for example, when gains and ...
Have a question or comment?
We're here to help.