What does retention mean in insurance terms?

When you’re shopping for life insurance, you’ll commonly see the term “ retention used. It’s a term that refers to the amount of money you lock in with your policy. In other words, the amount of premium you’ve paid in since the policy was first issued.

What does retention clause mean in insurance terms?

The term “ retention is used in the context of life insurance. It refers to the length of time you have to pay premiums on a policy before your coverage ends. If you pass away during the coverage period, then your beneficiaries will receive the proceeds. However, if you stop paying your premiums, then your policy will lapse. In that case, your beneficiaries will not receive any money.

What do you mean by retention in insurance terms?

The term retention is thrown around quite a bit in the insurance industry, but it really refers to the percentage of a policyholder’s premium that an insurer keeps over time. Typically, the most common form of retention is a flat rate, meaning that your insurer will retain a fixed percentage of your premium regardless of how much you actually pay each year. However, the most common form of variable rate retention is a graduated rate, which means that your insurer will retain a higher percentage of the premium you

What does the word retention mean in insurance terms?

Sometimes, it's used to describe the portion of the premium that an insurer keeps over and above the amount needed to pay for claims. The term is also often used for the portion that goes to investing your premium dollars. This helps protect your premium dollars from inflation and allows for a modest rate of return.

What does the word retention mean in insurance?

The term “retention” refers to the amount of money that an insurance company typically charges you each year. It is not the same as your premium. Premiums are paid to your insurer each month to keep you covered for the length of your policy. In contrast, the amount that your insurer will charge each year for continuing coverage is known as “retention.”