Investments
Definition of "Investments"
Money expended with the object of profit. The goal of an insurance company is to invest in assets with a rate of return greater than that to be paid out as benefits under its policies. Traditionally, life insurance companies have invested in long-term financial instruments such as mortgages. Today, under current assumption life insurance policies, investments are in short-term financial instruments. Property and casualty insurance companies, because of the nature of their policies, favor short-term financial instruments as investments.
Popular Insurance Terms
Trust instrument that permits the owner of a residence (grantor) to transfer ownership of that residence with the grantor still being allowed to stay in that residence for a stipulated ...
Deleveraging of the insurance company's balance sheet. ...
Wording in life insurance policies to determine the order of deaths when the insured and the beneficiary die in the same accident. For example, if the insured is deemed to have died first, ...
Policy whose premiums, cash value, and face amount are guaranteed (all values are fixed and do not fluctuate according to the loss experience, expenses, and investment returns of the ...
Measurement of how people feel about prevailing economic conditions, employment outlook, and personal finances. This index is based on statistics gathered from questionnaires mailed by the ...
Bond guaranteeing that a contractor will perform under the contract in accordance with all specifications of the bid submitted. ...
Demographic designation used in life insurance to calculate premium rates for life and health insurance and annuity contracts. Since females have a longer life expectancy than males of the ...
Reserve at the beginning of the policy year that is equal to the terminal reserve for the preceding year plus the net level premium for the current year. ...
Same as term Cancellation Provision Clause: provision permitting an insured or an insurance company to cancel a property and casualty or a health insurance policy (circumstances vary; see ...
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