Yearly Renewable Term (YRT)
Yearly renewable term (YRT) is a type of insurance policy that is renewed annually. This type of policy provides coverage for a set period of time, usually one year. At the end of the term, policyholders can choose to renew the policy for another year, or to cancel the policy.
An example of a YRT policy is life insurance. When a policyholder purchases life insurance, they will usually have the option to renew the policy on an annual basis. The policyholder will need to pay the renewal premium in order to keep the policy in force.
The formula for calculating the renewal premium for a YRT policy is: renewal premium = original premium x (1 + rate of increase). The rate of increase is determined by the insurance company and is based on factors such as inflation, the policyholder’s age, and the policy’s terms and conditions.