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
Variable-rate bonds whose coupon and value increases as interest rates decrease. ...
Important 1944 U.S. Supreme Court ruling that the insurance business constituted interstate commerce and was thus subject to the SHERMAN antitrust act. This decision came in U.S. v. ...
Option clause in a disability buy-out insurance policy that permits the owner of the policy to increase the limits of coverage for the expenses associated with the buy-out process. Usually, ...
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Act that mandates that employers who have at least 26 employees must provide a terminating employee and family members, if residents of employee's household, with health insurance coverage ...
Status in which an insurance company holds funds of its insureds (the payment of premiums) in trust, and through an insuring agreement promises to make all benefit payments for which it has ...
Addition to reflect exposures with a greater probability of loss than standard exposures. For example, insuring a munitions factory obviously requires a premium greater than that required ...
Type of hold-harmless agreement made by a property owner as a condition for being served by a railroad spur. If the owner wants a special sidetrack, the railroad requires the owner to ...
Term referring to the most common charge, in health insurance, for a service. ...
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