Legal entity that provides for ownership of property by one person for the benefit of another. The trustee receives title to the property, but does not have the right to benefit personally from that property. The trustee has a legal obligation to manage the property and invest its assets solely for the beneficiary of trust. Since the trustee is required to manage the property and its assets in a prudent manner, if the trustee fails to perform in accordance with the PRUDENT MAN RULE the trustee becomes personally responsible for any lost funds or profits incurred by the trust. There are basically two types of trusts: LIVING TRUST (established during the life of the GRANTOR) and TESTAMENTARY TRUST. For example, a trust may be established by a parent to hold assets for the benefit of a child.
Popular Insurance Terms
One-year coverage that is renewable at the end of each year. Since the group plan is subject to experience rating, the premium rate upon renewal is based on such factors as the loss record ...
Bona fide organization that purchases insurance on a group basis on behalf of members. However, a group cannot be formed for the purpose of purchasing insurance since adverse selection ...
In many property insurance policies, a requirement that the insured carry insurance as a percentage of the total monetary value of the insured property. If this percentage is not carried, ...
Amount, not in excess of $10,000 per year, given to each of an unlimited number of donees free of federal estate tax and gift tax. Each individual can give up to $10,000 to any one donee, ...
Financial incentives credited to the policy to encourage the policyowner to keep the policy in force. The incentives may be utilized by: (1) applying them to the policy cash value after a ...
Canadian retirement plan much like U.S. individual retirement account (IRA). Here, an employee can contribute on a tax deductible basis C $3500 each year as a member of an employer pension ...
Transfer of highly individualized loss exposures that is not based on the usual pooling principles of insurance such as risk identification and classification selection. Rather than setting ...
Rules of conduct and commissions paid to agents. For example, under the rules of conduct agents may be required to submit all of their business to only that agency. The contract also lists ...
Provision for coverage for buildings and personal property within the simplified commercial lines portfolio policy (sclp). The buildings and personal property coverage may be classified in ...
Have a question or comment?
We're here to help.