Types of Bonuses in Life Insurance
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Rishabh Surana
Interview Question for CT5 – 9 What are some types of bonuses in life insurance contracts?
Mayank Goyal
RISHABH wrote:Q. What are some types of bonuses in life insurance contracts?
Ans:
Bonus is an additional benefit is given to the policyholders to increase the basic sum assured in respect of any emerging surplus of assets over liabilities in valuation. Types of bonuses are:
Reversionary bonus – which is paid at the time of maturity of the policy, but is declared every year during the term of the policy, when the company makes a profit.
Terminal bonus– which is paid on the termination of the policy, but may not be declared every year.
Interim Bonus– which is paid in case of a policy claim is made between two bonus declaration dates. In such a case, the bonuses which have to be accrued to date is paid and called an interim bonus.
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