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Types of Bonuses in Life Insurance Policy
Compound Reversionary Bonus: Compounded every year, raises the bonus amount and base sum assured year by year.
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Types of Bonuses in Life Insurance
When the previous year’s bonus adds up to the sum assured and the next year’s bonus is computed on this consolidated amount; it is referred to as compound reversionary bonus. The calculation is based on compound interest. However, since it is reversionary in nature, the bonus is payable upon maturity or the death of the policyholder as above.