Stock Appreciation Rights (sars)
Definition of "Stock appreciation rights (sars)"
Contractual rights to a stipulated percentage of the increase in the value of an insurance agency over a given future period of time. They are used to convey a percentage of the increase in the agency's value to a key employee without resulting in the owner (s) of the agency owning less than 50%. The advantages of such a stock transfer for the agency owner include the following:
- Noncompete agreements not further reinforced since the key employee does not receive benefits if an agreement is violated.
- The key employee is tied to the agency because that employee can become an equity owner without actually committing his or herown funds.
Popular Insurance Terms
Same as term Convertible Term Life Insurance: coverage that can be converted into permanent insurance regardless of an insured's physical condition and without a medical examination. The ...
Charitable planning strategy under which a donor transfers title to his or her residence or farm to the charity. Upon transfer of title, the donor reserves the right to occupy the property ...
Expenses taken out when benefits are paid. For example, a specific dollar amount is subtracted from a monthly income payment for company expenses. ...
Extent of the loss caused by accidents. Used in predicting the dollar amount of losses upon which the premiums are based. ...
Payments in excess of the value of the loss a prohibited practice. When an insured has more than one policy covering a risk, the full value cannot be collected from each policy if a loss ...
Organization of over 300 property and casualty insurance companies whose mission is to investigate fraudulent claims and bring to justice those making such claims. ...
Elements within a group under study that have the same characteristic (s), have the same expectation of loss, are very much alike with respect to the variable under consideration, and do ...
Amount that each member of a pool contributes to that pool. ...
Rules stating that, for any portion of the payment made to the employee from an eligible rollover distribution, the plan administrator is required by federal law to withhold 20% of the ...
Have a question or comment?
We're here to help.