Value of In-Force
Encyclopedia
In life insurance
, value of in-force is the present value of the profits
that will emerge from a block of life insurance policies over time.
The value of in-force business is the present value of expected future earnings on in-force business less the present value cost of holding capital required to support the in-force business.
Life insurance
Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger...
, value of in-force is the present value of the profits
Profit (accounting)
In accounting, profit can be considered to be the difference between the purchase price and the costs of bringing to market whatever it is that is accounted as an enterprise in terms of the component costs of delivered goods and/or services and any operating or other expenses.-Definition:There are...
that will emerge from a block of life insurance policies over time.
The value of in-force business is the present value of expected future earnings on in-force business less the present value cost of holding capital required to support the in-force business.