Direct or discretionary participation feature
What are contracts with direct participation feature and contracts with discretionary participation feature? Whats the difference between the two?
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What are contracts with direct participation feature and contracts with discretionary participation feature? Whats the difference between the two?
Comments
Direct participation features allow policyholders to share in the profit and losses of the underlying business. It is mainly a life insurance concept, maybe universal life or smth. I don't think P&C has policies that have direct participation features. For discretionary participation features, it is similar to direct participation features except for the fact that insurers have control over the timing and amount of the benefits paid to the insured. This is about as much as I know. Life actuaries will know more as this is not really relevant to P&C actuaries