Yearly Rate of Return Method Definition
This actuarial procedure was developed by Dr. Joseph Belth, a professor at Indiana University, and is used to determine in a cash value Life insurance policy, the annual rate of return at which annual benefits would have to be gained n order for the annual investment made in the policy to be equal. The benefits under the policy are the cash value dividends (if participating insurance) and the death benefit for the year. The investment made in the policy is the total of premiums paid into the policy that year and the cash value at the beginning of that year.
In response to Hurricane Charley, A.M. Best Co. has been gathering public and private information in order to assess the financial impact the hurricane will have on the global property/casualty insurance and reinsurance industry. A.M. Best believes that virtually all companies will be able to meet their commitments despite the projected magnitude of the potential losses.
Life Insurance Baltimore
Auto Insurance New York
As part of A.M. Best's analysis, each individual company is evaluated based on its ability to withstand the impact from a major event, including hurricanes. Although this particular hurricane represents a significant economic loss, actual insured losses are expected to be less than some current projections due to the industry wide improvements, including loss mitigation initiatives and the formation of the Florida Hurricane Catastrophe Fund, implemented subsequent to Hurricane Andrew in 1992.
Liability Insurance Michigan
While the greatest impact will be within the homeowners and automobile segment, additional losses are anticipated in the commercial segment, including commercial multiple-peril, business interruption and agriculture business.
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Over the next few weeks, A.M. Best will be evaluating the impact of this event in greater detail as additional information becomes available.
Business Insurance PA
It is anticipated that while individual ratings may be affected, the overall financial strength of the insurance industry will not be significantly weakened.