What Is a Cancellation Provision Clause? A cancellation provision clause is a provision in an insurance policy that permits an insurer, or an insurance company, to cancel a property and casualty or a health insurance policy at any time before its expiration date. Life insurance policies do not contain cancellation clauses, and while health insurance
What Is the CAC 40? The CAC 40 is the French stock market index that tracks the 40 largest French stocks based on the Euronext Paris market capitalization. The CAC 40 started with a base value of 1,000 in December 1987 and continued to operate on a total market capitalization system until 2003 when it was changed
What Is the Currency Adjustment Factor (CAF)? The currency adjustment factor (CAF) is an additional cost on trades between the United States and Pacific Rim countries. The levy is imposed by shippers in that region to cover currency fluctuations while goods are in transit and to account for a declining value of the U.S. dollar
What Is a Cafeteria Plan? A cafeteria plan is an employee benefit plan that allows staff to choose from a variety of pre-tax benefits. Employees can contribute a portion of their gross income before any taxes are calculated and deducted. Plans normally include options such as insurance benefits and benefits that help employees with various
What Is the Compound Annual Growth Rate (CAGR)? The compound annual growth rate (CAGR) is the rate of return (RoR) that would be required for an investment to grow from its beginning balance to its ending balance, assuming the profits were reinvested at the end of each period of the investment’s life span. Key Takeaways
What Is Caisse Populaire? Caisse populaire describes a cooperative, member-owned financial institution that fulfills traditional banking roles, in addition to providing lending, insurance, and investment services. Chiefly found in the province of Quebec in Canada, caisses populaires are essentially the francophone equivalent to credit unions in the United States. Key Takeaways Caisses populaires are cooperative
What Is a Calamity Call? A calamity call is a protective measure for investors in a collateralized mortgage obligation (CMO) that is triggered if defaults or prepayments on the underlying mortgages threaten to interrupt the cash flow generated by the investment. If the cash flow generated by the underlying collateral is not enough to pay the
What Is a Calculation Agent? A calculation agent is an individual or entity that is responsible for determining the value of a derivative. A derivative is a financial security that derives its value from an underlying asset or benchmark. A calculation agent calculates the value of a derivative and the amount owing from each party. The
What Is a Calendar Spread? A calendar spread is an options or futures strategy established by simultaneously entering a long and short position on the same underlying asset but with different delivery dates. In a typical calendar spread, one would buy a longer-term contract and go short a nearer-term option with the same strike price.
What Is a Calendar Year Experience? A calendar year experience is used in the insurance industry to signify an insurance company’s “experience” during a calendar year. Also known as an underwriting year experience or accident year experience, it is the difference between the premiums earned and the losses that have been incurred (but are not necessarily
