Death-backed bonds

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Death-backed bonds

Bonds backed by loans of a policyholder against a life insurance policy. The policyholder will repay the loans while alive or with the benefits from the insurance policy upon death.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Death-Backed Bonds

Bonds secured by a pool of life insurance policies. Coupons on death-backed bonds come from the profit the insurance company derives from each life insurance policy. Death-backed bonds carry little risk because every life insurance policyholder eventually dies.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved