Embedded value
Also called: value of new business, VNB, VNB margin, persistency
For a life insurer, its net worth plus the present value of future profits from policies already sold.
Because life insurance profits emerge over many years, reported profit is a poor guide. Analysts use embedded value, the value of new business written each year, the VNB margin and persistency, the share of policies customers keep paying for.
Learn more in these lessons
- Analysing insurance companiesHow do you analyse an insurance company?
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