Hello,
Looking for a clarification about 'benefits' being a deduction while calculating asset shares.
Cost of benefit= cost of providing guarantees with respect to benefit which is same as benefit in excess of asset share.
For example, if sum assured is 10,000 and asset share at the time of claim is 9000.
Now, the difference of 1000 will be deducted from asset share as it is the cost of benefit. After this deduction and other additions/deductions from asset share, say asset share = (9000-1000-800)=7200 (assuming net deductions after cost of benefit= 800).
Terminal bonus on this policy (assuming its a with profits policy) will be calculated assuming asset share = 7200.
Is my understanding correct? Thank you!
Looking for a clarification about 'benefits' being a deduction while calculating asset shares.
Cost of benefit= cost of providing guarantees with respect to benefit which is same as benefit in excess of asset share.
For example, if sum assured is 10,000 and asset share at the time of claim is 9000.
Now, the difference of 1000 will be deducted from asset share as it is the cost of benefit. After this deduction and other additions/deductions from asset share, say asset share = (9000-1000-800)=7200 (assuming net deductions after cost of benefit= 800).
Terminal bonus on this policy (assuming its a with profits policy) will be calculated assuming asset share = 7200.
Is my understanding correct? Thank you!