Assumed Interest Rate is the prescribed
interest rate selected by insurance companies to determine
the value of annuity contracts and the amount of annuity
payments that will be paid out to investors, upon maturity
of their investments. The monthly payments provided by
an annuity depend on:
Insurance companies use the Assumed
Interest Rate as a minimum prescribed rate that must be
earned on investments in order to cover their overhead costs
as well as make a decent profit.
