Premium income
The income made by an insurance company resulting from premiums paid for insurance products. |
Similar financial terms
Liquidity premiumThe amount that forward interest rates exceed expected future spot interest rates.
Time premium
Also called time value, the amount by which the option price exceeds its intrinsic value. The value of an option beyond its current exercise value representing the optionholder's control until expiration, the risk of the underlying asset, and the riskless return.
Term premiums
Excess of the yields to maturity on long-term bonds over those of short-term bonds.
Tender offer premium
The premium offered above the current market price in a tender offer.
Single-premium deferred annuity
An insurance policy bought by the sponsor of a pension plan for a single premium. In return, the insurance company agrees to make lifelong payments to the employee (the policyholder) when that employee retires.
Risk premium approach
The most common approach for tactical asset allocation to determine the relative valuation of asset classes based on expected returns.
Risk premium
The reward for holding the risky market portfolio rather than the risk-free asset. The spread between Treasury and non-Treasury bonds of comparable maturity.
Premium bond
A bond that is selling for more than its par value.
Premium
(a) Amount paid for a bond above the par value. (b) The price of an option contract; also, in futures trading, the amount the futures price exceeds the price of the spot commodity.
Option premium
The option price.
Call premium
Premium in price above the par value of a bond or share of preferred stock that must be paid to holders to redeem the bond or share of preferred stock before its scheduled maturity date.
Conversion premium
The percentage by which the conversion price in a convertible security exceeds the prevailing common stock price at the time the convertible security is issued.
Earned income
The compensation from participation in a business, including normal remuneration (wages, salary and commissions) and bonuses.
Underwriting income
For an insurance company, the difference between the premiums earned and the costs of settling claims.
Taxable income
Gross income less a set of deductions such as allowances, deeds of covenants, and losses.
Spread income
Also called margin income, the difference between income and cost. For a depository institution, the difference between the assets it invests in (loans and securities) and the cost of its funds (deposits and other sources).
Net income
The company's total earnings, reflecting revenues adjusted for costs of doing business, depreciation, interest, taxes and other expenses.
Monthly income preferred security (MIP)
Preferred stock issued by a subsidiary located in a tax haven. The subsidiary relends the money to the parent.
Income Statement
This is company's accounting statement that shows its Income, Expenses, and Profit (or Loss) over a period of time. It is a picture of the financial performance of a company. It is sometimes referred to as a Profit & Loss (P&L) Statement. It allows a compay (or others) to compare its performance to that of other similar businesses. It tells shareholders how well their company is doing with respect to generating profits and earnings per share.
Effective gross income
Normal annual income including overtime that is regular or guaranteed. The income may be from more than one source. Salary is generally the principal source, but other income may qualify if it is significant and stable.
Household income
The total level of income earned by all the households in the economy. This will be a significant part of the overall level of National Income.
National income
The value of goods and services created by a country in one year.
